Keynote: Good Jobs Strategy

I'm kay kress and Waterman I am one of the organizing committee members here in New York Sloane fellow oh six and I'm thrilled that you're all here I hope you're like really enjoying it I have been blown away by the people I've met in the last 24 hours you know you think you know really cool people then you come here and you meet really cool people so just curious who's met somebody in the last 24 hours that they are going to keep in touch with after they leave here okay if you didn't you have to stay for the cocktail I'd make it get that done all right so I am really excited to introduce this is a sort of a great window that I got to participate in the Entrepreneurship panel amazing people and a bunch of whom I already know and I hope you really enjoyed that and I now get to introduce somebody I think is really special some of you may know Zeynep tom is a professor of practice at Sloan she is from Turkey she came to the United States on a scholarship as an undergrad and stayed and like all of our MIT faculty a doctorate from Harvard because heaven forbid you should be any less and has done really incredible work in the labor space and human resource space she has done research about organizations and the people who work for organizations and what you have her bio in the program but what I think is so interesting is that ten years ago and more when most people were talking about how to make Lieber really cheap and how to really make it all very routine eyes you know so that people were practically machines she was taking the opposite view the contrarian view and saying investing in people is really a major key to success that investing in what they learn how they learn how they're empowered how they're in pain how their pay really makes a difference and her research if you look at the list of her research it's just a who's who of the retail space so Home Depot Trader Joe's are like you think of a major retailer it's probably on her research list and from that work she wrote a book many of you were grabbed it off the tables at dinner last night the the good job strategy the red book who was a bunch of people were lucky enough to get a free copy last night and that led to more people reaching out to her more companies reaching out to her and the creation of a nonprofit called the good jobs Institute and I'm really excited to hear her speak and hear where we go from here what what new exciting things she has to say and probably contrarian from the rest of rest of industry so please welcome sign up Tom Thank You K for that introduction and good afternoon if you were in my class I would ask you to come forward and I will say I promise I'm not gonna cold call you or though I see some of my former students and who knows maybe I might ask a few things and see if they remember I'm delighted to be here and here's what I'm gonna talk about last year 47 million people in the United States 47 million Americans worked in jobs where the median wage was less than $15 an hour that's more than a third of workforce and $15 an hour might seem like a lot but if you work like 35 hours a week every single week that's $26,000 a year not enough to take care of your family this morning I was in Atlanta and I was talking to an industry convenience chain industry which employs two and a half million of these 47 million workers and the message that I gave to them is the message that I'm gonna give to you which is if we want to create a strong middle class in the United States and I think all of you here would agree that we so desperately need a stronger middle class in the United States we can't do that by treating these jobs like retail fast-food homecare workers as just stepping stone to good jobs we need to make these 47 million jobs good jobs themselves and the people who work in jobs right now they're angry they're frustrated they are longing for a sense of pride and dignity and the good news is that transforming these bad jobs into good jobs is not only possible but it can also be very profitable for companies but doing that especially in these low-wage sectors where the profit margins are very thin and competition is tough doing that requires a lot of operational excellence and that's the message that if you want to have good jobs especially in these types of settings we have to pay attention to operations and operational excellence let me just go backwards and tell you how came to this conclusion so I am I'm in the operations management faculty at MIT Sloan my background is retail supply chains I started doing my research 20 years ago in retail supply chains and join a group of researchers and we were looking at how retailers can get the right product the right store at rate at the right time and we were looking at data algorithms pricing assortment optimization inventory planning and then during one of our conferences the CEO of Office Depot at the time he raised his hand and he said you know you supply chain academics are obsessed with data and analytics and planning but guess what often times my retail supply chain gets the right product to the right story at the right time and then no one can find it at the store because it's in the wrong place has this ever happened to you you're going to just raise your hand if it's if you've ever experienced this problem exactly so he was talking about this 20 years ago this is still a problem he called it phantom stock-outs I studied this problem at borders remember borders they're not with us anymore a couple of weeks ago in my MBA course we did a case about them they didn't go back because they did research with me just to get it out of the way but then I started seeing problems like phantom stock house data inaccuracy promotion non-compliance all sorts of operational problems inside the retail stores these problems were big they were expensive they heard the supply chain they heard sales they heard labor productivity they heard saying they heard cost also source of weight so the obvious question was why did these problems happen all the time why are they so common and one of the answers was because of the sheer operational complexity in these environments but the other big driver was labor practices stores that had more employee turnover had more problems stores that had less training had more problems stores that just didn't have enough people to get all the work done had more problems and in fact what I found was that retailers and I'm going to talk about retailers but since then I've been working with other companies as well and the story is pretty similar we're finding themselves in a vicious cycle and the vicious cycle starts with the mentality that people are a cost like everybody says people are our biggest asset and most valuable asset but people don't show up in the balance sheet they show up in the income statement as a cost and and if you are I mean that's what it is and if you are in an industry with single and low single-digit profit margins and cost minimization is so important and you have this objective of minimizing labor cost that forces the unit managers to cut those costs as much as possible because you have your whole performance management systems around cutting those costs and that leads to under investment in people under investment in people leads to operational problems operational problems leads to high lower sales lower profits what happens to labor budgets when sales decline they shrink right and then this vicious cycle continues so the only reason I studied this vicious cycle was because of my interest in retail supply chains and because it reduced profits but then I started seeing the implications of this vicious cycle for workers and that was to be quite honest heartbreaking like I came from the United States from Turkey to the United States on a viable scholarship this country has been so amazing to me and I saw the United States like many of my friends saw the United States as the land of opportunity but then when I started doing my research and started interviewing people I realize hey work is not working for these people and they were smart they were competent they were that they were hard-working just just to give you a picture of what work is like first of all wages in the retail space last year the median wage was $11.33 an hour that's it and poverty level right and even if you work 40 hours a week every single week you still don't make enough money but no one gets to work 40 hours a week every single week even if you're a full-timer because 90% of the companies consider anyone who worked 30 hours a week to be a full-timer so your income can vary from like 30 hours of labor to 40 hours of they were from week to week and not only does your income a your hours your work schedules vary all the time so most retailers provide their employees their work schedules one or two weeks in advance and they can change in the last minute and the hours are usually all over the place can you imagine like living your life where you don't know when you're gonna work next week can you imagine like if you're a single parent who's gonna take care of your child or can you imagine I mean one of the I I've interviewed so many workers but one of them said to me she was when I met her she was working for this chain for seven years she was promoted several times making 1160 an hour and she said I can't get by I can't take your care of my kid and I need to have another job but I can't hold on to another job because my schedule changes all the time and she said and you know what my income base but my bills don't so that that variability in income just hurts the low-wage workers in ways that we can't even imagine and and you mentioned routinize in work one thing I heard over and over was have people felt like they didn't matter one worker said to me we are a dime a dozen just human robots and if you if you have an environment where people are treated this way turnovers is of course very high right my students will remember Jim stealing gold from Costco and the founder of Costco who comes to class and he says if the food's there and to think that you can hire somebody for $10 an hour and they will stay with you for any time at all they're gonna leave and they find something for 50 cents more per hour and what's gonna happen in that environment is that your managers will be just focused on hiring the next warm body to work for you and when they do that they're fighting fires and they're not managing their business anymore and not surprisingly in these environments with high turnover and a poor employee experience it's almost impossible to provide a good customer experience these are customer facing environments right unique go into retail store and you see the workers there and they're interacting with you and when you look at Yelp comments Google comments or I'm making customer satisfaction index you see a lot of retailers to be scoring really low because if you don't meet your basic needs of humans employees you won't need the basic needs of customers and the at least one nice thing with Amazon is that competition is getting stronger and which means that now it's a customer's market which means that for you to stay in business you have to provide a compelling reason for your customers to come to your stores so that's one driver of why some companies are changing now they're finding this food labor practices and bad customer experience unsustainable the other reason why this is unsafe unsustainable is the labor markets right we have tight labor markets now some is it's hard to find good labor it's hard to find people who want to work for you if you're paying them $10 an hour and it's also hard when the minimum wages are increasing so so I'm hoping that ten years from now when we look at this industry we are going to see lots of changes and those companies that don't change I don't think they're gonna be with us any longer like they should just look back the auto industry and look at what happened in the auto industry and learn from what happened in that auto industry right but if you think about Henry Ford's time when the auto industry started Henry Ford started this moving assembly line it was amazing before only wealthy people could afford car but with the moving assembly line there were so many efficiencies and now a typical emerging American could afford to buy a car but in that assembly line that was one weakness which is it wasn't just parts that were interchangeable people were also used as interchangeable parts work was so routinized people didn't matter employee turnover was so high in that factory in fact Henry Ford was famous for saying why is it that I have to hire a whole person but all I need is a pair of hands and and then but then what we learned in manufacturing decades later but did learn in manufacturing is using people as just a pair of hands is not the best way to make cars like we learned when Toyota came in that if you invest in your people if you invest in your processes then the outcome is not just higher quality cars but it's also lower cost cars so Toyota showed us that you can break the trade-off between cost and quality if you invest in your people and if you invest in your operations and that's exactly the type of change that we need in retail and some retail and other in other industries where the investment in people is very low and some companies have figured out exactly how to do that I'll give you a couple examples of those companies that I've studied there in the book but of course the darling of good jobs in in these sectors as Costco any Costco shoppers here I'd say like I go to Costco every weekend customers are fans investors are fans they've when I give presentations I put a 10-year chart of Costco's performance versus SMP 500 and versus their biggest competitor always outperforming and the median wage of an hourly worker at a Costco warehouse this year right now is slightly twenty three dollars an hour twenty three dollars an hour yes I was trained at Harvard but I know that that's higher than eleven thirty three so so Costco is one example of a company I'll give you another example that my students I'm just looking at the two and there's more here Kwik Trip is another example of a company convenience store chain with gas stations this morning the Kwik Trip CEO was there it's like 7-eleven convenience store with gas stations but the starting wage in Tulsa Oklahoma for a full-timer is $42,000 at Kwik Trip their turnover is of course much lower their prices are just as lower than anybody else's and again they have very satisfied customers oh and by the way their profits per store profits are 89% higher than the top quartile in the convenience store chain industry I'll give you another example Mercadona is Spanish supermarket chain and this is Spain's largest supermarket chain and they have been growing thriving at a time in Spain where so many companies are not and when I met them and this is again their low-cost leader when I met them I asked them what is your employee turnover and from the United States I'm used to like hundred percent hundred and twenty percent numbers and they said four percent and I'm like maybe the Spanish people have a different way of calculating employee turnover but but then when you go to the stores and you ask people how long have you been there 20 years 25 years the store managers were telling me how many people they lost last year look we lost two people last year why Maradona pays double the minimum wage in Spain and there's a bonus that people get every year makedonia Maz four weeks of training 100% internal promotion just like Costco just like quick trip and and also 85 percent of their employees are full timers who get their schedules one month in advance and who work in shifts so they have stability in their lives so these are some examples of companies that had the combination of low prices good jobs and great performance for their for their investors and the obvious question was like what do they do how do they do this and and I so wish that the answer was well they just pay more invest more in their workers and then the world is a much better place then they attract the right people you know they attract right employees they work harder they stay longer their turnover costs are lower and that's the that's the end of it I wish that was the answer because it would be a very practical solution to our big economic problems but the answer wasn't there that when I analyzed these companies I saw that they have a whole different operating system than their competitors it was so much like the contrast between Toyota Production system and the GM or Ford Production system so in on the one hand they invested so much in their employees not just in terms of wages and benefits but also in terms of training hiring higher expectations but on the other hand these companies made a set of operational choices operational choices that increase is the productivity of their employees and that increased the contribution of their employees and motivation of their employees at the same time but these same operational choices that these companies made enable that people investment because if he messes something you want high productivity high return on that investment so you have to create that type of productivity but what I saw was that for them to be able to make those operational choices they also had to invest in their people like those operational choices did not work without having a highly motivated and capable workforce in the book since you all have free copies if you don't have copies don't buy one you can go to our website good jobs institute.org and we have lots of information about these choices so I'm just the best promoter of my book I say to people don't my publisher loves me so but if you look at them there are four so if for operational choices that I saw that's coming among them I'm gonna spend like a minute on each of those choices and then and then move on because I want to hear your questions that's that's more important than me just talking here so the first question that the first choice that they had was the combination of strategic focused and operational simplification like so many companies tried to be all things to all people these companies were very clear about what they offered their customers what they didn't offer their customers and they simplified their operations along that lines so I'll give you an example if you go to America donor store a typical retail store case 40,000 different products 40,000 different products America donor store carries 9,000 products a typical retail store supermarket chain they would rate they will change the prices all the time remember from your operations classes when you change your prices what happens to your supply chain like you introduced all sort of work variability into your supply chains so that's how a typical retailer operates makedonia keeps the prices steady so what happens when you have fewer products and steady prices that means that now your employees don't waste their time they're a lot more productive and they're shelving merchandise there more productive and they're checking people out there not only more productive but they can also build expertise because now with fewer options and simpler operations they can get to know their operations they can get to know their products and then they can shine in front of the customers so one operational choice simplification improves their productivity and it also improves their contribution because now they can talk to customers about those things another operational choice is the combination of standardization empowerment on the one hand these companies standardize so many things standardized so many routine processes but then they empower their employees to make decisions the type of decisions I shall give you the opposite of empowerment I was shopping at Whole Foods a while ago and you know in Cambridge we have to bring our own shopping bags to Whole Foods right through because otherwise you have to pay for the for the bags so one day I bought one of those shopping bags but it broke after first use I meant to Whole Foods the next time and ask the cashier like could you exchanges it's like a three dollar bag and then she said I have to ask my supervisor I'm like really so she it was a Saturday she asked her supervisor in the meantime I'm meeting the other customers are waiting she ran and she she she spent the supervisors time her time if you're paying people $15 an hour this is not the best way to operate right but you see this is the lack of empowerment and the good jobs companies do the opposite they would have changed my back like like this what would that mean there would mean speed for the customer better service for the customer what would that mean higher productivity for the employee right so that's the empowerment the third thing that they do these companies do is cross-training so if you go to a Trader Joe's store and Trader Joe's store Trader Joe's is one of those companies I talk about if there's a long line of customers that they check out somebody who shall shelving merchandise they will come and they'll they'll open another register right because they're cross trained to do both customer facing and non customer facing things so that they can react this is a form of ability that you learned in your operations class the fourth choice which is my favorite choice is what I call operate with slack so if you go to Costco you see a lot of employees go to Trader Joe's you see a lot of employees you might not see that many products like the product variety might be low but there will be enough people to take care of you because these companies always are on the side of having too many rather than too few people that way people can do their jobs without making errors that way they can take care of the customer that way when they have ideas for improvements they have time to identify communicate and act on those but of course operate with slack can't work if you have slackers right so these companies on the one hand they make these operational choices but on the other hand they have high expectations of their employees these are it's much harder to work at a quick trip store than at a 7-eleven store it's much harder to work at america done' then it's because supermarket chain because the expectations are high you have to come to play every time and they have high performance standards and they hire the right people i mean they do all those expectations stuff right so this is the system that i call the good job strategy which is a combination of those four operational choices and investment in people and what i have found from the companies and this is a limited limited set of companies right we don't have like hundreds of retailers doing this to be able to do quantitative studies but when you look at them you see that they do better financially and they do better competitively financially any metric that you look between these companies and others productivity metric customer satisfaction metric or cost metrics they are perform their competitors sales per square foot you know inventory turnover etc but her perhaps more important than that these companies have been able to differentiate themselves in the eyes of their customers right they have they offer their customers not just low prices but also something else right is they break those trade offs between or and they say low prices and friendly you know warm service when you think about Trader Joe's or when you think about our Kwik Trip at the Kwik Trip it's all about quickness the other strategic advantage that these companies have is that because they have great people and because they have good operations they have this execution capability so they can react the changes much faster than their competitors can when the economic crisis hits pain maca Donna from one year to the other they drop their prices by 10% 10% that's a huge deal not everybody was happy but they did it and guess what happened to their market share afterwards right they they started capturing a lot more market share from others that's the strategic advantage that you can do things that your competitors cannot do and one thing we know technology changes labor markets change regulations change what customers want change so it is those those companies who are able to adapt to changes who will stay with us for much longer so you might be thinking like if this is so good like why the so few few companies do this which is there which is there which is a very fair question but I I will say that right now there are too many companies still treating their people as interchangeable parts and too few companies doing what is called this good job strategy and what I think it will take and there's there's this there's a movement there's a slow movement right if you look at companies like Walmart for example during the last four years Walmart raise their wages by about 50% for their starting employees they've improved schedules they are reducing their product variety they're creating different technologies to improve the productivity of their store associates like theirs they're they're investing in their stores and of course slowly these things take time are slowly they're seeing an impact there are there's one retailer in North West that implemented the good job strategy and it's been a great journey for them and now my MBA students don't know about it but now we have a new case and they come to class and we discuss it they raise wages by 30 percent this is a company that had two percent profit margins in three they raise wages by 30% they increase the percentage of employees who work from more than 30 hours from 65% to 82% and as a result these people have benefits now and at the same time they reduced their prices they did lots of operational changes and it was a fantastic journey for them and they're still seeing some of those benefits so what will it take like for us to get more companies to operate this way and I think it will take a lot of effort from all sorts of stakeholders right we are I mean we think about business that is not to say the government cannot play a role and that is also not to say worker groups can't play a role but let me just talk about the role of the just to keep the government aside for the time being that and but let me just focus on what I think it will take from the business community to get to more good jobs I think it will take a lot of leadership to get there and few excuses to get there from the leadership what do I mean I mean the first thing is we need competent leaders who can understand organizations as systems that work together because the good job strategy is a system it has multiple elements and you have to incorporate those and elements and when you're doing a transformation you have to stay on that path and know how the elements work with one another so so competence is one but the other is compassion and humility like leaders don't have all the answers right there's this there's this humility problem that I see where people tend to think that we can design everything from the top and we can think about all the things that's gonna happen we can standardize everything from the top and just have the workers execute the role doesn't work that way when you meet leaders like Jim Sinha go Costco's founder you see how humble he is and he wants to learn from the frontline he knows that they have when it comes to improving their work like they have the answers and I think along with humility comes with compassion I'll give you one story which happened very recently you know Jamie Dimon was on the he had this exchange some of you might have seen it with key reporters your senator from California and she grilled him and she said you know your bank tellers they're not making living wages right they're just not making enough money to be able to take care of your employees then she said okay here's what you offer what the wages in my County for this worker and every month she's four hundred and fifty eight dollars short every month so what do you do about that and he kept saying I don't know I had to think about it I don't know I had to think about it and then he said which is the part that drive me crazy well maybe one day she can have my job and I'm thinking yes that's exactly what she has in mind - so I think what we need is compassion and for some companies doing the right thing is actually economically very possible right for some companies paying people living wages is more like if you think that you are a moral person and you want to do the right thing it's actually quite possible in the context of retail where the labor costs are a huge percentage of their cost like raising wages of $15 would get some companies into bankruptcy right doing the right thing there is very hard and it requires a lot of operational excellence but in some other places if actually quite possible but we need a little bit more compassion from our leaders to understand what the economic life is for the people who work for them maybe they visit their houses maybe they see how they live but we need that type of compassion so I think we need the many the competence we need the compassion and humility and need the courage and commitment I mean if a company transforms we have a new paper that that is almost accepted in organization science and very sure that if a company wants to move from a bad job strategy to a good job strategy then along the way they're going to get some mixed signals things are going to get worse first and if you have a culture of test and learn and test and learn and you have it you run a three-month experiment and see is this working you're gonna get bad signals and you're gonna move away or if you are the type of leader where every time there's a performance pressure the first thing you do is what can we cut this is not going to work so so we need leaders to have courage and commitment to this we need leaders who have compassion and humility and we need more leaders who have the competence to be able to execute something like this and I think our MIT Sloan community is very well positioned for this and I think it's going to be up to us to create an American America where more people have good jobs so thank you and we have science your time for questions yes yeah so one industry that we started working with at good jobs Institute is Senior Living and one of the organizations that we're working with at this moment is a non-profit who works in that space it's I mean they face very similar maybe not on the investor side but the journey looks quite similar for them as they do for not-for-profit firms but do you have something more you know the margins are sometimes small you and just the capacity to you're in the grind so much to step back and think about strategy it's hard for a number of the the one difference I will say is when a for-profit company comes to us to help them their motive is either financial or competitive the nonprofit this company when they came to us their motive was morale they said we want to be able to raise the wages for our caregivers how do we do that in a profitable way yes ok I'm sorry sorry sorry sorry I want you to comment on two things cultural norms and wage differentials between top and bottom just give examples of that I happen to live in Switzerland and there's a very strong cultural norm there that everyone should have a living wage and so things there's a bargain things are more expensive but basically everyone has good wages on the other side you're Jamie diamond example / Costco example together I used to work at JPMorgan just that full disclosure but in terms of there used to be a few that in essence the top person shouldn't get more than let's say 25 times the lowest employee in terms of wages differentials and you didn't mention either of those yeah that's part of the good job strategy and I'm just an Operations professor I mean I'm just an operations versus I work here but I'll tell you not as an academic I haven't studied the the wage gaps but I'll tell you my views something that's very interesting when we look at the leaders at the top we have no trouble paying them their contribution we say wow this this person's a great job shouldn't we shouldn't we pay them what they contributed to our environment but when it comes to frontline or managers we don't pay them their contribution we just pay the market wages right so there's a disconnect like between how we think about pay for the top versus for for for an average worker and I agree with you like it's out of whack and hopefully it will correct at some point in terms of social and this is related to the social norms to it because it is so acceptable for for for leaders to be paid that much in terms of our culture I wish that everyone paid more attention to this I was on a panel with it with the CEO of a restaurant chain local restaurant chain in Boston and he said you know my customers are so conscientious about the environment and they want to know like how the chickens that we serve how they were treated like all these things and he goes but no one cares as some of my employees used to sleep in their cars and like I think it's a society we have to start paying attention to this and say you know what I'm going to shop at places that doesn't take care of their employees and and and not choose others I know by the way we don't have to pay more to be able to do that it just takes a lot more effort to identify Glassdoor is one place where you can identify you know these things but I fully agree with you yes hi I'm Marcia and Armani thank you so much for sharing your passion around good job strategies I was wondering if any of your work has been around creating an inclusive culture for individuals with disabilities as an underserved community there's been a lot of research around how it's not only the right thing to do but it's good for business so I was curious to see if you've had any work yeah that is a really important topic I have not done any work on it but that is not to say it's not an important topic so I can't say about either you know from a moral point of view of course from an economic point of view I don't I don't know but yes yes thank you for sharing and my question is for my experience to have being every organization is very profit driven so when you have two options one is probably improving the system improving an infrastructure but doesn't bring any sales revenue for the company it is always viewed as less important versus something else that is immediately profit and revenue generating so I was wondering from your experience in your research are there any practical ways that we can maybe you know bring to attention the issues to have to be addressed in an organization and changing mindset of people the leaders so that you're they're more they're more interested in investing in the people you know I think there's always a lot of temptation to especially money under performance pressure to cut costs in places that are very easy to cut costs and that could be related to your employees or it could be related to your customers right and oftentimes there is this there is this dynamic where you know when you cut cost that's very immediate you say you see the effect on your profit right away but then the cost associated with that our longer term is hard to articulate it's hard to quantify and of course we are wired to emphasize a short term over the long term as human beings right that that's something that people have shown before so what can be done about this one of the things that some of the good job strategies companies do is that they clearly articulate who comes first when they have to make decisions so if you go to Costco which is a public company right so this is not a privately held company if every warehouse you will see their prioritization the number one is obey the law so 100% of the time they're gonna obey the law but then they have customer first employee second supplier third investors shareholders the last and by being able to do this sticking to this prioritization they have been able to create a lot more value to their shareholders but the reason they do this and they stick to it hundred percent of the time is it's just so tempting to cut on the customer or to cut on the employees when you're under performance pressure and putting this prioritization and putting this constraint this values base says when you're under performance pressure okay I can't take benefits away from my people I can't take recognition plans from my people like I can't do all those things how else can I how else can I innovate Southwest Airlines is a great example of this right Southwest Airlines has this no layoff policy and after 9/11 I think almost every airline with the exception of Southwest and and some other airline they they laid off their workers I think about 16% of the whole workforce was laid off afterward Southwest did not lay off but they said they went to their employees and they said help us lower costs come up with ideas to help us lower costs and by the way those ideas stay with you for a long for forever right is opposed to the temporary layoff so so they had these values they have these principles and they stick to them not 90 percent of the time not 95 percent of the time but hundred percent of the time and that's what three makes the value a value actually this is a follow up on the comment you just made about Costco about their priorities and recently several CEOs Jamie Dimon included yes the Business Roundtable right Business Roundtable about the management's responsibilities is not limited or when I was in school I remember professors management responsibility is to maximize shareholder value I remember at the time I was asking myself hmm that's kind of strange so what about the employees and there are a lot of stakeholders I'm just wondering in light of that statement have there been are there any companies reached out because this is clearly employees is part of the stakeholder and to re formulate this your findings in the context of stakeholder maximizing all stakeholder values or propositions yeah I guess the question is yes some leaders have reached out but a slightly longer answer to your question it's like it's great that they came up with that statement it's wonderful let's see what happens I mean so easy to put a statement like that like let's see if we see raises in wages in any of these companies that went behind the statement right they see if we see any benefits so I think it's just easy to put things on a piece of paper but it needs to be accompanied by some action and I I'm still a little bit skeptical in that okay who has the microphone I see the heads I first of all thank you so much I've learned so much from from what you've said today and my question is as we see a lot of these even retail companies have digital strategies as well and have you know maybe some workers be remote do the strategies that you discussed before the four operational strategies do they change as you start to see do they change when you look at the business units that are on the ground brick and mortar versus maybe some of the digital businesses these organizations have or if you start to look at remote workers fixing yeah I have not looked at the remote workers it's an interesting thing I have not looked at because I have looked at the organizations where a group of people get together to accomplish a goal in that setting that's why cross training etc is important I have an extended beyond the remote workers but that would be an interesting area to to look into I think I'm done one more ok one more ok all right actually I have the microphone okay so I'm here afterwards so I I'm happy to speak outside so I work in Silicon Valley and there's been a lot of press this year about contract workers Google has more contractors than permanent employees a lot of commentary about lyft and uber riding on the backs of contractors a lot of expose is about facebook moderators who are contract workers how does what you're doing apply to some of the most powerful companies in our economy that are sitting in tech OH again if contract workers is not some area but can I just make it common a general view about the Silicon Valley mentality and how this feeds into the good job strategy and what we're seeing because contract workers I mean you can see them maybe even some of the part-time workers in retail are just like contract workers because they're just they're working 13 hours a week I mean they come and go and and they're not the part of the organization they don't have benefits of course legally they're they're separate but I think one of the things that Silicon Valley didn't us much favor and in terms of these jobs is that when you think about an organization that needs to create good jobs that needs to have good management practices and that needs to have good management that doesn't work with exponential growth like we have been so obsessed during the last 10 15 years with companies that just grows so fast you can't if you're hiring $10,000 10,000 workers a day you're gonna make lots of mistakes if you're offering new facilities every month you're not gonna have good managers opening those facilities who know how to coach their people who know how to develop their people who know how to provide good feedback there's just not going to happen and I think that fast super fast growth mentality has been one of the and that's what we celebrate now right that's what we celebrate and it worked with by it's like scalability but with Athens and with people like it's much harder to to the desk that amazing scalability and I think I'm hoping that with all the you know value look at the other thing is though of course a part from facebooking Google's none of these companies are making money either so it's a very interesting situation where investors have been very patient with them while they make no money so I'm hoping that we will reverse to the times where we valued management practices be valued good management and-and-and we valued profitability so thank you very much I hope you had a good time

Channel: MIT Sloan Alumni

Views: 1,767

Keywords: #MITSloanAlumni, #MITSloanWomen, #MIT, #MITSloan, MIT Sloan Global Women’s Conference

Id: f3mulnDEmew

Length: 47min 2sec (2822 seconds)

Published: Wed Oct 30 2019