John Mackey, what were you thinking?
CEOs are paid big bucks to be smart, savvy operators, but a couple weeks ago, Mr. Mackey, who’s the CEO and one of the co-founders of Whole Foods (Stock Quote: WFMI), did something which was, in our estimation, incomprehensible.
Here’s what happened: Mr. Mackey wrote a column for The Wall Street Journal on Aug. 11 in which he voiced his opposition to President Obama’s health care reform plan. He outlined a number of measures he thought prudent, some of which were directly based on his experiences as CEO.
“The combination of high-deductible health insurance and HSAs is one solution that could solve many of our health-care problems,” he writes “For example, Whole Foods Market pays 100% of the premiums for all our team members who work 30 hours or more per week (about 89% of all team members) for our high-deductible health-insurance plan. We also provide up to $1,800 per year in additional health-care dollars through deposits into employees' Personal Wellness Accounts to spend as they choose on their own health and wellness.”
His most provocative statements come toward the end of the column.
“A careful reading of both the Declaration of Independence and the Constitution will not reveal any intrinsic right to health care, food or shelter. That's because there isn't any. This ‘right’ has never existed in America.”
What’s incomprehensible about Mr. Mackey’s piece is not the nature of his ideas; rather, it’s the fact that his ideas are very much at odds with the sentiments of so many of Whole Foods’ customers. It’s like the president of Harley Davidson Motorcycles suggesting that tattoos be banned. It’s just not good for business ... or your career.
"The typical Whole Foods customer tends to be educated, liberal and urbane and I would venture to guess supportive of President Obama and his attempt to reform healthc are so the richest country on earth no longer has a health care system ranked 37 in terms of coverage and efficiency."
Whether or not this accurately describes the majority of Whole Foods’ customer base is certainly debatable, but it almost certainly represents a good many of them. New York’s public radio station, WNYC, recorded a number of Whole Foods shoppers for a piece broadcast Aug. 22. A woman only identified as Shelly said this:
“I used to shop here all the time and frankly there are three or four other places I could go to so I don’t see any reason to support a store that doesn’t support an issue as important as health care ... they are entitled to their position but if it’s not my position, I don’t see why I should support them.”
Beyond that, a Facebook group called "Boycott Whole Foods" (along with a corresponding blog at WholeBoycott.com) now has more than 28,000 supporters. There’s also a "Do Not Boycott Whole Foods" group on Facebook, but it has only just more than 3,400 members. Whole Foods, to its credit, has created a forum for discussing the subject on its Web site, allowing even the harshest criticisms on its own turf. Like this one from a poster called Betrayed:
“I was so shocked to read Mr. Mackey's horrible, horrible opinion in the WSJ. i have been a loyal WF customer for almost 20 years. I am disgusted to find out what the founder's attitude is.”
The Whole Foods brand may in fact be taking a beating over this issue. Mashable.com reports that according to a study by YouGov.com, Whole Foods has experienced an overall drop in brand perception -- it’s stock however is up significantly during the past week.
Whole Foods has since tried to smooth things over on their own Facebook page and in other outlets, noting that Mr. Mackey’s views were his own and didn’t represent the corporate policy of Whole Foods, adding “John absolutely does care about his fellow citizens who do not have health insurance, and he is in favor of health care reform. He believes that the proposals he put forth will provide access to sustainable health insurance for more people.”
That will probably do relatively little to soothe the masses of liberal Whole Foods patrons who are taking this very personally, and therein lies the real lesson here, for Mr. Mackey and other business owners big and small.
When you own or run a company, particularly one with a massive customer base, you in many ways become the voice of the company. For company leaders like Mr. Mackey, the line between personal opinion and company policy will always be blurred and overlapping. He had to know that when he wrote the op-ed in the Journal and he had to know how much it would alienate many of his customers. But he did it anyway.
Even if his opinions were “right” and represented the best course for the country, he’s risked what gave him the platform to speak in the first place: his very successful brand ... and in this economy, no one can afford to do that.
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