Whole Foods

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Whole Foods Market
International Center for

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Outperformance

Whole Foods Market

“Whole Foods Market, Inc. is the largest natural-foods grocer in the United States. It is also one of the business world's most radical experiments in democratic capitalism. Plenty of companies talk the talk of empowerment, autonomy, and teamwork. This company has spent 16 years turning those (often empty) slogans into a powerful - and highly profitable - business model.” Charles Fishman

"Whole Foods is a social system" "It's not a hierarchy. We don't have lots of rules handed down from headquarters in Austin. We have lots of self-examination going on. Peer pressure substitutes for bureaucracy. Peer pressure enlists loyalty in ways that bureaucracy doesn't." John Mackey, CEO and co-founder, Whole Foods Markets

Table of Contents
Short company overview..........................................................................................................................3 Management Practices listed by Beyond-Budgeting-Principles.....................................................................5 References............................................................................................................................................13 License................................................................................................................................................ 13

Version 1.1, May 2009 (Version 1, Dec 2008)

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Short company overview

Whole Foods CEO and co-founder John Mackey is known to be a business “anarchist”. One that substitutes fear with love. Being not an organization, but a “Community of Purpose”, Whole Foods Market reflects modern management views e.g. of Jeff Howe (“Crowdsourcing”) or Vineet Nayar (CEO HCL Technologies), that organizations are today more and more evolve into communities. Being a today a role model for Management 2.0, Whole Foods Market's radical management practices have long been known by the Beyond-Budgeting-Movement. Being a true Beyond-Budgeting-Pioneer, Whole Foods Markets has maintained the alternative model since its foundation in 1978. As John Mackey personally points out: "One of the keys to understanding this company is that the people who started it did not know

how they were supposed to do it," "This is the way our culture has developed." Further Mackey adds: “I had no legacy to overcome,” “It also meant we had to reinvent the wheel.” John Mackey never attended any business school, nor received any academic degree despite studying several years philosophy. Whole Foods Market may mostly be influenced in the 1970s by Japanese business books Mackey studied, especially the empowered and principle based team-culture. Or maybe the Whole Foods Market culture may have its roots within “Starship Enterprise”: John Mackey is a keen fan of the TV series and esp. of the political organization of Star Trek's “United Federation of Planets” nearly looks similar as the Whole Foods Market's cell structure. Further Whole Foods Market is built upon Abraham Maslow's hierarchy of needs. "Humans' needs move up

from food and safety, to community and a sense of belonging, to the need for beauty," Mackey lectures. "The next levels are education, esteem, and self-actualization." Whole Foods Market developed itself since its foundation in 1980 (opening of the first market in Austin, Texas) by John Mackey and Renee Lawson Hardy, owners of Safer Way Natural Foods, and Craig Weller and Mark Skiles, owners of Clarksville Natural Grocery, to nowadays largest organic- and natural foods grocery in the United Stated and even the world. Its retail network includes today more than 270 stores in North America (USA, Canada) and in the United Kingdom (about 80 new ones are currently in planning). With over 54.000 employees worldwide it generated a turnover of about 6,6 billion $ in 2007.

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Whole foods generates about a turnover of about 7000 US $ per...
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