A giant supermarket chain in Florida is well known - or at least it was about ten years ago - for its warm relationship with its fifty thousand odd employees.
The company publishes a biweekly bulletin that lists all the births, deaths, marriages and serious illnesses of employees and their families. For more than twenty years, the company president had
sent personalized cards to the families of everyone listed in the bulletin.
But when a new president was appointed in 1984, he decided to discontinue sending cards for births, marriages and illnesses.
"I'm afraid the day might might come when I'll no longer be able to write the notes," he explained. "It's far better not to do something than to commit yourself to something you may not be able to
We'll return to this company presently. But now, let's take a look at another.
When the brown aircraft of People Express - a name carefully chosen - took to the skies in 1980, its founders initiated a social experiment on the grandest of scales. It was probably the most
elaborate attempt at corporate democracy ever.
"Teamwork takes on a whole new meaning at People Express," proclaimed one of the recruiting ads. "The single predominant reason why I cared about starting a new company," declared president Donald
Calvin Burr, "was to try and develop a better way for people to work together."
|You're a manager, not a commodity, new recruits were told
So many people flocked to join the company on hearing this message, that only one out of a hundred applicants could be accepted. "You're not a commodity," Burr would stress to new recruits at the
end of intensive five week long, six-day-a-week (without pay) training programs. "You're not a beaten down worker. You're a manager. You're an owner."
And apparently, he meant it.
There were no supervisors, secretaries or vice-presidents at People Express. All employees were given the title of manager. They were rotated among jobs frequently - in the air as flight
attendants, at the airports as ticket agents, or behind the scenes in the accounting or scheduling departments.
One third of the corporate profits were distributed to employees. They all owned a minimum of a hundred shares of the airline's stock.
"When you fly People's Express, an owner is never more than a few steps away." boasted one its newspaper ads.
According to a New York Times Magazine writer who attended one of the training sessions, one of the new employees "practically floated out of the room" after hearing president Burr speak.
"I think the man's a wizard," he told the reporter. "This is the opportunity I've been waiting for all my life. This is my road to self-actualization."
Fired with an infectious excitement, the "owner-managers" would work a ten to twelve hour day. Since per capita productivity was high, People Express operated with about fifty staffers per
airplane, about half the industry average.
Burr was determined that the company should become " a role model for other airlines and businesses," and it did. Not only had it become the nation's fifth largest airline within five years, but
it had become famous for its humane management philosophy.
"Anyone who isn't studying People Express and the way they're managing people is out of their minds," proclaimed a Harvard professor of repute.
A short two years later, People Express was no more. Drained by an excessively rapid expansion, Burr was forced to sell the entire airline before it was too late.
The reasons for the company's failure will probably be debated in business schools for many years to come, as business reporter Robert Levering points out in his fascinating book, A Great
Place to Work. But parallel to the financial crash, a failure of a different sort became evident in the course of time. For all his ingenuity as a motivational guru, Donald Burr's grand scheme
for ultimate corporate democracy had long turned sour in the eyes of many of his employees.
Levering masterfully analyzes the reasons for this in his book. During the final week of the airline's existence as an independent entity, he talked at length with numerous People Express
employees. They talked of feeling "ripped off", "betrayed," "lied to," and "manipulated." They stressed that these feelings surfaced on a large scale long before the airline flew into financial
There's a special excitement about being involved in launching a company, and part of the People Express experience has occurred at countless other companies, too. Everyone feels needed and
useful.The "partners" at People Express felt like winners, despite the long, uncompensated hours of work.
But in this kind of situation, it's easy for the people at the top to purposefully prolong the start-up phase, and to take advantage of their workers' love of excitement and novelty. The very
responsibility given to the employees can become deceptive. Their very loyalty can become an object of manipulation.
And although an elaborate communications system was in place at People Express, it worked well only when the going was good. But there were no viable mechanisms for handling employee complaints
and concerns. The system made no provision for conflicts, because it assumed a kind of everlasting harmony between the employee-managers and the top executives.
From the workers' point of view, it was the betrayal of trust that ultimately broke the camel's back. In the conventional labor exchange,the employer agrees to pay employees a specific sum of
money for carrying out certain tasks that the management defines. That's the extent of the relationship.
But much more had been going on at People Express. The airline made a series of promises. It promised employees stimulating work. As "manager-owners" rather than "beaten-down" workers, they had
been promised by top management that they would have more responsibility for their jobs. But this implied, to some extent,more responsibility also for the direction of the company. Often, the
promises fell far short of the reality.
And at People Express, many employees discovered that broken promises led to broken dreams.
Now let's return to the company I was referring to at the beginning of this article - Publix Super Markets, with its several hundred stores. In his book, Robert Levering paints a word picture of a
banquet he attended in Jacksonville, to celebrate the opening of a new Publix store. As they do for every store opening, the company's top dozen corporate officers traveled to the event from company
|To many, the banquet had the earmarks of an old-fashioned revival meeting
"The banquet had the earmarks of an old-fashioned revival meeting," reports the author. "Corporate executives and managers from other Publix stores rose to give testimonials - all variations of
the same gospel...' This is a company that cares about you and your success.' One store manager told of an incident early in his career in which another employee was hospitalized for surgery, and the
store manager stayed with the family at the hospital during the operation. 'I felt like I was part of a family', he declared. 'Publix people have a heart'. His testimonial was met by a chorus of
amens from several old-timers."
To many, this banquet may have appeared to be like a sports pep rally. At such meetings, you often hear "Our team is the best in the world," even when the team has just lost ten games.
From an employee viewpoint, it must be difficult to look at such an event without cynicism - particularly for someone who had experienced a People Express training seminar! Perhaps the big-wigs
were thinking to themselves: "Tell people whatever will make them feel good. Then they'll work harder, and we'll make more money."
And as any politician knows, you can win votes by making promises, but voters eventually expect you to deliver.
Fortunately, the high-ups at Publix were very aware of the risk they were taking. They knew that if the reality of work life in their company failed to match the eloquent talk, it would be far
better had they not spoken at all.
In an atmosphere of trust, communication can flourish. But trust is not something that can be turned on at will, like a tap.
One company executive expressed it well. "People don't give you their trust and respect," he insisted. "They only loan it to you."