Amazon business model
Via Naked Capitalism:
In a scoop, Business Insider reports on how Amazon is creating massive turnover and pointless misery at Whole Food by imposing a reign of terror impossible and misguided productivity targets.
Anyone who has paid the slightest attention to Amazon will see its abuse of out of Whole Foods workers as confirmation of an established pattern. And even more tellingly, despite Whole Foods supposedly being a retail business that Bezos would understand, the unrealistic Whole Foods metrics aren’t making the shopping experience better.
As we’ll discuss below, we’d already expressed doubts about how relevant Bezos’ hyped Amazon model would be to Whole Foods. Proof is surfacing even faster than we expected.
The Business Insider story on Amazon, ‘Seeing someone cry at work is becoming normal’: Employees say Whole Foods is using ‘scorecards’ to punish them, is another window on how Bezos thinks whipping his workers is the best way to get results from them:
The title here is misleading. OTS was not the brainchild of Amazon, it was already implemented by Whole Foods prior to the purchase.
Amazon owns it now though.
You are right JG…
Whole Foods needs to get some tougher employees.
Three factors are at play here:
1. Excess supply of low wage level employees relative to overall demand for them. Employees are being exploited because there are no restrictions on exploiting employees. Choices are put up with it or quit. That’s the way it’s always been without a Union.
2. Culture change & profitability demand —- remember that Whole foods sold for a reason. Culture change was a given. “It ain’t the company it used to be.” for sure and for good reason.
3. Employees won’t / are prevented by U.S. laws and rules favoring employers from forming a union. Note the Amazon’s having big union problems in Europe because the State includes laws that allow unions bargaining power.
Amazon like other company’s everywhere on the globe simply find or seek the optimal profit point for a given level of employee expenses and labor productivity.
Employee turnover and retraining are one of the employee expenses so if it get’s too high it hurts profits. But when skill demand is low as it is for retail or warehousing then costs of turnover and retraining are low also, which means optimal profits occur with higher turnover rates as long as there is more than sufficient excess supply of low skill labor.
If we want to change business practices in the U.S. get the laws changed to make forming Unions as easy as forming a business. That’s the only way it will change.
Instead of complaining about Amazon, Walmart, and other sweatshops complain to your congressman and Senator (state and federal) about our labor laws and restrictions on forming unions. Complaining about Amazon won’t change it, but if it feels good to vent and since it’s a lot easier than getting the laws changed, then by all means vent on. .
Reading up on Whole foods under MacKey’s leadership (prior to Amazon buying it) Whole Foods was noted for being among the least desirable places to work because of company employment practices and benefits.
“Mackey, a libertarian, believes that unions facilitate an adversarial relationship between management and labor. An attempt at unionizing in Madison, Wisconsin, in 2002 was met with resistance from store management and Whole Foods was accused by labor activists of union busting. Employees at the Madison store voted in favor of unionization. Whole Foods then refused to bargain with their employees. After a year, the company moved to decertify the union. Further attempts at unionizing Whole Foods Market stores have been unsuccessful. Whole Foods launched a nationwide campaign, requiring workers to attend “Union Awareness Training,” complete with Power Point presentations.
Whole Foods was criticized for its refusal to support a campaign by the United Farm Workers (UFW) on behalf of agricultural workers laboring on strawberry farms. During the late 1990s, the UFW persuaded several large supermarket chains to sign a pledge in support of improved wages and working conditions for strawberry pickers. Whole Foods chose instead to support the farm workers indirectly by holding a “National 5% Day” where five percent of that day’s sales – $125,000 – was donated to organizations which provide social services to farmworkers.”
“….’: Employees say Whole Foods is using ‘scorecards’ to punish them, is another window on how Bezos thinks whipping his workers is the best way to get results from them:..”
Under Mackey they used the “team member” “points” system… which as a “scorecard” with points for attendance, tardiness, appearance, customer complaints, manager’s assessments, etc.
Is there a difference between an employee calling the “points” system a “scorecard” system? I highly doubt it.
The Naked Capitalism article is clearly not providing an objective story here.