'Seeing someone cry at work is becoming normal': Employees say Whole Foods is using 'scorecards' to punish them (Business Insider)

‘Seeing someone cry at work is becoming normal’: Employees say Whole Foods is using ‘scorecards’ to punish them

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Whole Foods

Whole Foods uses "scorecards" to punish employees for
failing to comply with its inventory management
system.

Maggie
Sterling


  • Whole Foods uses checklists called "scorecards" and
    tests called "walks" to ensure stores comply with a new
    inventory-management system.
  • Employees say the system has crushed morale and led to
    widespread food shortages.
  • "The stress has created such a tense working
    environment," a supervisor at a West Coast Whole Foods store
    said. "Seeing someone cry at work is becoming normal."
  • Many employees at both the corporate and the store
    levels don’t understand how OTS works, employees said.

Whole Foods has a new inventory-management system aimed at making
stores more efficient and cutting down on food waste. And
employees say the retailer’s method of ensuring compliance is
crushing morale.

The new system, called order-to-shelf, or OTS, has a strict set
of procedures for purchasing, displaying, and storing products on
store shelves and in back rooms. To make sure stores comply,
Whole Foods relies on "scorecards" that evaluate everything from
the accuracy of signage to the proper recording of theft, or
"shrink."

Some employees, who walk through stores with managers to ensure
compliance, describe the system as onerous and stress-inducing.
Conversations with 27 current and recently departed Whole Foods
workers, including cashiers and corporate employees — some of
whom have been with the company for nearly two decades — say the
system is seen by many as punitive.

They say many employees are terrified of losing their jobs under
the new system and that they spend more hours mired in
OTS-related paperwork than helping customers. Some are so fed up
with the new system that they have quit or are looking for other
jobs. In addition to hurting morale, OTS has led to food
shortages across Whole Foods stores,
they say
.

On calls with investors, Whole Foods executives have said that
OTS has helped cut costs, reduce shrink, clear out storage, and
enable employees to spend more time engaging with customers. And
employees, as well as outsiders, have said that the company’s
decentralized system was inefficient and needed a change.

But the new system goes too far, according to the employees who
spoke with Business Insider.

"The OTS program is leading to sackings up and down the chain in
our region," said an employee of a Georgia Whole Foods. "We’ve
lost team leaders, store team leaders, executive coordinators and
even a regional vice president. Many of them have left because
they consider OTS to be absurd. As an example, store team leaders
are required to complete a 108-point checklist for OTS."

All the employees spoke on condition of anonymity for fear of
retribution. Whole Foods did not respond to requests for comment
on this story.

Scorecards and tests force employees to comply with new rules

Whole Foods enforces compliance with OTS by instructing managers
to regularly walk through store aisles and storage rooms with
checklists called "scorecards" to make sure every item is in its
right place, according to nearly 80 pages of internal company
documents reviewed by Business Insider.



Whole Foods scorecard


Click to
enlarge.

Business
Insider


If anything is amiss or there is too much excess stock in
storage, departments lose points on their scorecards.

"Every item in our department has a designated spot that is
labeled or marked," an employee of a Colorado Whole Foods store
said. "If that item is even an inch outside of its designated
spot … we receive negative marks."

The walks also involve on-the-spot quizzes, in which employees
are asked to recite their departments’ sales goals, top-selling
items, previous week’s sales, and other information.

Failing scores — which qualify as anything below 89.9% — can
result in firings, employees said.

Store managers conduct these tests, internally referred to as
"walks," twice weekly, according to the company documents.
Corporate employees from Whole Foods’ regional offices also carry
out walks once monthly, and ultimately stores must pass a walk
conducted by executives from Whole Foods’ global headquarters in
Austin.

Employees who spoke with Business Insider say the walks have
instilled fear across every department of Whole Foods’ stores.

"I wake up in the middle of the night from nightmares about maps
and inventory, and when regional leadership is going to come in
and see one thing wrong, and fail the team," a supervisor at a
West Coast Whole Foods store said. "The stress has created such a
tense working environment. Seeing someone cry at work is becoming
normal."

The maps this employee referenced are diagrams drawn up by Whole
Foods’ corporate office that dictate where every item in the
store should be placed.

"The fear of chastisement, punishment, and retribution is very
real and pervasive," another worker said.

Whole Foods is morphing into a conventional grocery store

Employees, suppliers, and industry analysts have all said that
Whole Foods’ old system of managing inventory before OTS was
highly inefficient and needed to be updated.

"Whole Foods had a very decentralized approach, which adds
complexity, and complexity adds cost," said Jim Holbrook, CEO of
private label and retail consultancy Daymon Worldwide, which
recently started working with Whole Foods.

Under Whole Foods’ old purchasing system, buyers at the store and
regional levels had more power to decide what to sell in their
stores. With OTS, Whole Foods’ corporate office in Austin is
making more of those decisions. This approach is bringing Whole
Foods’ business model more in line with those at conventional
supermarkets like Kroger and Safeway.

It remains to be seen whether this business model — and OTS —
will work for Whole Foods. Holbrook believes it will. He says
Amazon, which purchased Whole Foods last year for $13.7 billion,
will be able to help Whole Foods work out the kinks with OTS.

"Amazon is very good at managing logistics behind the scenes,"
Holbrook said. "Whole Foods will be a better shopping experience
as a result."

Many employees are also hopeful that Amazon will fix the new
system.

"We all just hope that Amazon will walk into some stores and see
all the holes on the shelf," a 12-year employee of a Midwest
Whole Foods store said.

‘It’s a collective confusion’

Whole Foods says order-to-shelf gives employees more time to
engage with customers.

"The team members are really excited about" order-to-shelf, Whole
Foods executive vice president of operations David Lannon said
last year on a call with investors. "They’re really proud when
they’re able to achieve that, which is lower out-of-stocks, less
inventory in the store, being able to be on the sales floor
talking to customers and selling more products."

Several store employees balked at that claim. "On my most recent
time card, I clocked over 10 hours of overtime, sitting at a desk
doing OTS work," a supervisor at a West Coast Whole Foods store
said. "Rather than focusing on guest service, I’ve had team
members cleaning facial-care testers and facing the shelves, so
that everything looks perfect and untouched at all times."

Some employees said recent labor cuts have made it difficult to
keep up with the demands of OTS. "It’s running everyone into the
ground and they absolutely hate it," a high-level employee of a
Midwest Whole Foods said.


Whole Foods

A Whole Foods store in
Boston.

Paul
Fantoni


Many Whole Foods employees at the corporate and store levels
still don’t understand how OTS works, employees said.

"OTS has confused so many smart, logical, and experienced
individuals, the befuddlement is now a thing, a life all its
own," an employee of a Chicago-area store said. "It’s a
collective confusion — constantly changing, no clear answers to
the questions that never were, until now."

An employee of a North Carolina Whole Foods said: "No one really
knows this business model, and those who are doing the scorecards
— even regional leadership — are not clear on practices and
consequently are constantly providing the department leaders with
inaccurate directions. All this comes at a time when labor has
been reduced to an unachievable level given the requirements of
the OTS model."

Two recently departed employees specifically cited lack of
training as a key reason why OTS is, in their view, failing.

"The problem lies in lack of training, and the fact that every
single member of management from store level to corporate is over
tasked and overburdened," said one former corporate employee who
was in charge of conducting walks at stores on the East Coast.

Others said it appeared that whoever wrote the program had no
experience working in stores.

"In the beginning, we actually had a checklist where one task was
to initial that you initialed off another task," said one
employee who was involved in OTS training at several East Coast
stores. She said that duty was quickly dropped, but that it was
emblematic of how the implementation of OTS has gone.

"The ‘nano’ management is downright insane," she said.

If you work for Whole Foods and have information to share,
email hpeterson@businessinsider.com.

via Business Insider

February 1, 2018 at 11:34AM

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