Month: December 2009

The New Yorker has a long article on Mackey which was a very good read.  Since it is so long, I’ve summarized what I found interesting from it below.  I’m terrible at summarizing and in college never got into highlighting my textbooks.  When reading I either found it all really interesting or all really dull, so it was either all yellow or remained all white.  So, the fact that I have summarized lots of text below should tell you a lot about what I thought of the article.

• Oversees fifty-four thousand “team members”
• A year ago, Mackey came across a book called “The Engine 2 Diet,” by an Austin, Texas, firefighter and former professional triathlete named Rip Esselstyn. Basically, you eat plants: you are a rabbit with a skillet. Mackey had been a vegetarian for more than thirty years, and a vegan for five, but the Engine 2 book, among others, helped get him to give up vegetable oils, sugar, and pretty much anything processed. He lost fifteen pounds.
• Mackey sought succor in spiritual practice. He engaged a friend, a follower of the Czech transpersonal psychologist Stanislav Grof, to guide him through a therapeutic session of holotropic breathing. “I had this very powerful session, very powerful. It lasted about two hours,” Mackey said in an inspirational CD set he released last year called “Passion and Purpose: The Power of Conscious Capitalism.” “I was having a dialogue with what I would define as my deeper self, or my higher self.” He had a pair of epiphanies, one having to do with severed relationships that needed healing. The other was that “if I wanted to continue to do Whole Foods, there couldn’t be any part of my life that was secretive or hidden or that I’d be embarrassed [about] if people found out about it. I had to let go of all of that,” he said. “I’m this public figure now.” He couldn’t “embarrass the company,” he told me. “I have to grow up”—he is fifty-six. “I can’t have affairs with women. One of the things that happened was you have more money and you have more opportunities for such things. And those are sort of off-limits.
• “I have my own views, and they’re not necessarily the same as Whole Foods’,” Mackey told me. “People want me to suppress who I am. I guess that’s why so many politicians and C.E.O.s get to be sort of boring because they end up suppressing any individuality to conform to some phony, inauthentic way of being. I’d rather be myself.”
• “He’s a ready-aim-fire guy, and he’s not real disciplined in how he speaks his mind,” Gary Hirshberg, the C.E.O. of Stonyfield, the organic milk and yogurt producer, told me. “He has a really hard time reconciling his public and private selves.” Mackey’s resilience has surprised even those who, like Hirshberg, hold him in high esteem. “John has that Clintonesque ability to hang in there,” Hirshberg said. “He is Whole Foods management’s greatest asset but also, at times, its greatest challenge.”
• The health-care op-ed’s headline, “THE WHOLE FOODS ALTERNATIVE TO OBAMACARE,” was the Journal’s, Mackey says, but the sentiments were his. Mackey’s prescriptions ranged from the obvious (people need to eat better) to the market-minded (promote interstate competition among insurers) to the dreamy (the corporations will take care of us). The gist was that, together, they’d obviate the need for a federal plan, and that the course being pursued by the White House and the Democrats would have disastrous consequences. He led with an epigram attributed to Margaret Thatcher: “The problem with socialism is that eventually you run out of other people’s money.”
• “I was so viciously attacked for two reasons,” Mackey told me. “One is that people had an idea in their minds about the way Whole Foods was. So when I articulated a capitalistic interpretation of what needed to be done in health care, that was disappointing to some people.” He begrudges the extent to which people have projected onto Whole Foods an unrealistic and idealistic vision of the company. “The C.E.O. of Safeway, Steven Burd, wrote an op-ed piece in June advocating, basically, market solutions to the health-care problem, and nobody gave a ****,” he said.
• In high school, Mackey was an indifferent student, a late bloomer, puberty-wise, and a fanatic about basketball, science fiction, and girls. Before his senior year, he was cut from the varsity basketball team, and he persuaded his parents to move so that he could switch schools and play. “That changed my life because for the first time I realized that if you didn’t like the hand you were dealt, you didn’t just have to feel sorry for yourself. You could do something about it.”
• He went on to Trinity University, a small school in San Antonio, and the world flowered before him, as it did for so many in those days. “I was reading a lot of philosophy and religion,” he said. “And I did a lot of those experiments that young people do when they’re in college. I’ll not name those.
• He quit playing basketball and, for the next several years, went back and forth between Trinity and the University of Texas, in Austin, taking only courses that interested him, and therefore hardly advancing toward a degree. He settled in Austin, in a house of ten or so men. He worked part-time as a dishwasher and spent his nights reading in the library. He had a beard and long bushy hair. Eventually, he moved into a co-ed vegetarian collective.“I had no interest in a vegetarian lifestyle,” he said. “But what I was interested in was alternative lifestyles. And I thought, honestly, that I’d meet a lot of interesting women. And I did.”
• He began to care about food. His mother had been of the generation of women emancipated by frozen and processed foods, and he hadn’t really ever paid particular attention to what he had been given to eat. Now he started cooking for the collective and working part-time at a natural-foods store called Good Foods. “I loved it,” he said. “I loved retail. I loved being around food. I loved natural foods. I loved organic foods. I loved the whole idea of it. And a thought entered into my mind that maybe this is what I could do.”
• In 1978, with forty-five thousand dollars from friends and family, he and his girlfriend at the time, Renee Lawson, decided to start a store of their own, which they called SaferWay—a takeoff on Safeway. The store was on the ground floor of a Victorian house; they lived on the third floor and ran a small restaurant on the second—a rustic prototype for today’s prepared-food extravaganzas. The house didn’t have a shower, so they bathed in the store using the hose from a dishwasher, a creation legend that the company holds dear.
• He soon noticed that a number of much bigger natural-foods stores had sprouted up around the country, such as Mrs. Gooch’s and Frazier Farms, in California. He persuaded Craig Weller and Mark Skiles, the owners of a store called Clarksville Natural Grocery, to merge with him and Lawson (in part, by implying that he might put them out of business), and, in 1980, the four of them opened the first Whole Foods, in a former nightclub. It was ten thousand square feet. They stocked not just lentils and granola but, in contravention of the co-op ethos, indulgences like meat, beer, and wine; there were aisles full of five-gallon bottles of distilled water, to avoid the embarrassment of empty shelf space. The idea was to go beyond the movement’s old tofu severity, the air of judgment and self-abnegation. Their version of decadence seems Spartan now, but at the time it represented a cultural shift.
• The first Whole Foods thrived, with a setback or two. (Another cherished legend: in 1981, a flood inundated the store with eight feet of water, and a battalion of customers helped the founders clean, repair, restock, and reopen it.) It became something of a local hot spot. “I did all the hiring the first five years,” Skiles said. “I had a field day, man.
• They built two more stores in Austin and expanded to Houston and Dallas. Then they bought a store in New Orleans called, of all things, Whole Food Company, settling on a strategy of buying existing stores in pursuit of a kind of nationwide Pax Austinia. The owner of the New Orleans store, Peter Roy, eventually became the company’s first president.
• Next came Palo Alto, which happened to be next door to a good deal of venture capital, and Mackey and his partners spent months plying Sand Hill Road. Of the twelve V.C.s they went to see, all but three turned them down. As Mackey recalls in “Passion and Purpose,” “One of them said one day: ‘You know, I really think you’re just selling hippie food to hippies. I gotta tell ya that I don’t think it’s gonna work. But if it does work, Safeway’s gonna just steal it from you, and you’re not going to be able to exist anyway.’ ” Mackey, for one, always feared that Safeway, or some other big chain, would do just that, but for a long time, it did not.
• After the successful opening of a Chicago store, in 1991, the company went public, and embarked on a company shopping spree.
• Mackey is an example of what you might call the auteur C.E.O. Like Steve Jobs’s, his personality is entwined in his company’s. He doesn’t bother with day-to-day operations; he’s not a technician or a face man. When he’s asked what it is he does, exactly, he describes a kind of philosopher-king, who brings big ideas to bear. Mackey, an outspoken critic of executive overcompensation, pays himself a dollar a year. No one at the company can have a salary more than nineteen times what the average team member makes (On average, an S. & P. 500 C.E.O. makes three hundred and nineteen times what a production worker does.) Last year, the highest salary went to Walter Robb, the co-president and chief operating officer, who made just over four hundred thousand dollars (supplemented by a bonus and stock options). The average hourly wage was sixteen dollars and fifty cents.
• Whole Foods has made Mackey a wealthy man. He owns roughly thirty million dollars in stock—less than one per cent of the company—and has sold millions more over the years. Still, he flies commercial and drives a Honda Civic hybrid. He has houses in Boulder and Austin, and a seven-hundred-and-twenty-acre non-working ranch an hour outside of town, where he and Deborah spend many weekends.
• Whole Foods routinely ranks high on those lists of companies that are the best to work for.  This view is not shared by unions, which have complained that Mackey prevents unionization among his employees, notably at a store in Madison, Wisconsin, where team members had voted to unionize. Unions have picketed store openings and, as activist investors in Whole Foods stock, have called for Mackey’s firing.  In the early eighties, Mackey told a reporter, “The union is like having herpes. It doesn’t kill you, but it’s unpleasant and inconvenient, and it stops a lot of people from becoming your lover.” (That quote, to Mackey’s dismay, won’t go away, either.)
• He told me, “If I could, I would wave a magic wand so that Americans ate better because the diseases that are killing us—heart disease, cancer, diabetes, multiple sclerosis, Alzheimer’s—these diseases have a high correlation with diet. And that is something that most people do not understand.”
• Mackey is, by all accounts, fiercely competitive. Years ago, the traditional executive-retreat volleyball games had to be scrapped, owing to Mackey’s intensity and his ill-disguised scorn for less capable teammates. (Mackey says that he simply got too old for volleyball.)
• “But you have a reputation for liking to argue,” I said to Mackey.  “But I don’t like to argue to be right. I like to argue because that’s how I get to the truth. I think dialectically.”
• I asked him whether he’d given thought to what might come after him. “I don’t have any plans to leave anytime soon, no matter how much the unions would like me to,” he said. Talk turned to food, as it often does. “You only love animal fat because you’re used to it,” he said. “You’re addicted.” He urged me to consider reprogramming my palate. He also suggested that I try Grofian breathing.

I haven’t had a chance to read Wisdom of Crowds yet by James Surowiecki but an article in Building43.com was very interesting.  It shows that collectively a crowd/group’s mind is better than your own when trying to solve a problem or answer a question.  Check this out…

“In 2007, Michael Mauboussin presented a big jar of jelly beans to his 73 Columbia Business School students. How many beans did they think it contained?  Guesses ranged from 250 to 4,100; the actual number was 1,116. The average error was 700 — a massive 62 percent — demonstrating that the students were awful estimators.  Now here comes the weird part.  Even with all these wildly incorrect guesses, the average guess was 1,151 — just 3 percent off the mark. Not only that, only 2 of the 73 students guessed better than this group average.  So, although individually everyone was woefully inaccurate, collectively the group was incredibly accurate.  Was this a fluke? Hardly. The experiment was made famous in 1987 by Jack Treynor. In his case, it was 850 jelly beans and 56 students. The group estimate was 2.5 percent off; only one student guessed better. The study has been repeated many times since with similar results.”

Apple had a famous ad campaign in 1997 asking people to “think different”.  How many off you think different?  If you find you or your company struggles to think differently, I just reviewed a great list of 50 ways to foster innovation and here are my favorite from the ideachampions.com article:

• Remember that innovation requires no fixed rules or templates — only guiding principles. Creating a more innovative culture is an organic and creative act.
• Wherever you can, whenever you can, always drive fear out of the workplace. Fear is “Public Enemy #1” of an innovative culture.
• Have more fun. If you’re not having fun (or at least enjoying the process) something is off.
• Always question authority, especially the authority of your own longstanding beliefs.
• Make new mistakes.
• As far as the future is concerned, don’t speculate on what might happen, but imagine what you can make happen
• Increase the visual stimuli of your organization’s physical space. Replace gray and white walls with color. Add inspiring photos and art, especially visuals that inspire people to think differently. Reconfigure space whenever possible.
• Help people broaden their perspective by creating diverse teams and rotating employees into new projects — especially ones they are fascinated by.
• Ask questions about everything. After asking questions, ask different questions. After asking different questions, ask them in a different way.
• Ensure a high level of personal freedom and trust. Provide more time for people to pursue new ideas and innovations.
• Encourage everyone to communicate. Provide user-friendly systems to make this happen.
• Embrace and celebrate failure. 50 to 70 per cent of all new product innovations fail at even the most successful companies. The main difference between companies who succeed at innovation and those who don’t isn’t their rate of success — it’s the fact that successful companies have a LOT of ideas, pilots, and product innovations in the pipeline.