“No Company is Perfect”..or is there?


Ryan’s article “No Company is Perfect” touched on two key controversial issues that were faced by Whole Foods. The first was the “alleged price scandal” where the company was mislabeling weights of goods in order to overcharge their customers anywhere from under $1 to $15 during their weakest period growth. The second was the exploitation of prison workers for cheap labor for the production of goods such as cheese and other popular goods. While his article delved into the issues being brought to light by the public, what do the shareholder’s have to say for themselves and is there anything that they can say that would make you believe that there is such thing as a “perfect” company?

In both cases, co-CEOs Mackey and Robb released public statements to address the issue. After the overpricing scandal, the co-CEOs released a video in which they apologized for their mistakes, claiming that there were also cases of underpricing and the overpricing of items was unintentional and understandable – “They are inadvertent. They do happen because its a hands-on approach to bringing you fresh food.” In short, they’re telling their customers that if they want fresh foods, overpricing is bound to happen. But is it?

Co-CEO Mackey went on to say overpricing is an issue that happens at every supermarket and the fact that Whole Foods was targeted makes the the company feels victimized by media and the public. Although the company publicly apologized for the mistakes that were made and have taken action to prevent the same thing from happening again i.e. retraining workers, I feel as though they are still trying to justify their actions by saying “the problem of overcharging [isn’t] specific to Whole Foods” which then makes me question whether or not it was a “mistake” after all.

If I were a company executive at Whole Foods, I don’t think that I would have done anything differently. I think the right decision was made by addressing the fact that people do make mistakes and taking action, i.e. retraining workers, to make sure that the same thing does not happen again. Whole Foods was also very clever in the way that they addressed the prison labor controversy by appealing to their stakeholders. A Whole Foods spokesman announced that although “we do believe that voluntary work programs like this do help people learn skills to become productive members of society, we always want to make sure we are in-tune with our customers’ wishes. That is why we decided to stop selling products made by inmate labor programs, and expect that those products will be off our shelves by April, 2016 if not sooner”. I’m sure that the decision to stop using prison labor was a well-calculated ($) decision on the part of Whole Foods, but the way that they shared their decision with the public was done so in a way that appeals to their stakeholders who now think that they have an influential voice within the company and are making a difference. This isn’t to say that stakeholders do not have an influential voice within the company, but I’m sure it didn’t hurt Whole Foods to win back some of their customers who were considering boycotting their stores.

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http://abcnews.go.com/Business/foods-suppliers-defend-prison-labor/story?id=34258597

http://www.businessinsider.com/whole-foods-ceo-says-the-company-was-a-victim-in-overcharging-scandal-2015-7

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4 thoughts on ““No Company is Perfect”..or is there?

  1. I really like this article. Many good points about the co-CEOs and their attempts at managing the media. It’s interesting to see leaders of large companies make calculated moves with the media. They try to do better than those that made mistakes before them. Often, though, the media will find a way to pick you apart. Managing for stakeholders often involves tradeoffs even if that is not ideal.

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  2. I also wrote about Whole Foods and found several similarities in my analysis when compared to yours. You delve deeper into the media dilemma, claiming Whole Foods was “victimized” by the media and public, and I agree with that statement. I admire the CEO’s for publicly admitting their faults and aiming to improve their actions by guaranteeing properly weighted amounts, and if a customer finds an error, they get the item(s) for free. As an executive myself, I would also not do anything differently, as Whole Foods handled the mislabeling and prison labor scandals in an orderly and timely fashion.

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  3. I agree, the situation was handled well by the CEO. Media is becoming the most important part of large companies like Whole Foods. All companies of this size are vulnerable to being victimized by the media. It is the responsibility of the CEO to make ethical decisions and to manage situations like the two you mentioned in your blog. Enjoyed the article!

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  4. The GOVERNMENT should not be allowing prisoners to undercut the wages of workers, and the labor costs of legitimate businesses. It is one step this side of SLAVE LABOR. C’mon people.

    Of course, it is better for prisoners to be productive and learn skills, but not at the cost of like a comic book version of evil capitalism where the hard-working people in the cheese industry have to compete with coerced labor.

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