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August 08, 2014 at 11:02 AM
I recall reading a play about feuding families set in Verona…oh yes, Romeo and Juliet by William Shakespeare. That’s what the Market Basket controversy reminds me of: feuding families and loyal fans or employees.
Market Basket is a chain of 71 supermarket stores in New England and 25,000 employees. The news abound about its management crisis: Arthur T. Demoulas (a.k.a. ATD) was fired as the chain’s CEO by his cousin, Arthur S. Demoulas who controls the board, because of a family feud that goes back almost 30 years. But what has been more surprising is that a lot of the employees either quit or have been protesting the lay-offs, demanding that Arthur T. be reinstated.
How did ATD become popular and inspire such a fervent following by his employees? The beginnings of the grocery store chain might have had something to do with his success. It started as a mom-and-pop market, and when the founders (ATD’s grandfather) sold it to two of their children, the brothers modernized it and made it a popular chain. They also implemented customer loyalty programs and created a very tight-knit corporate culture. But then, one of the brothers died; his heirs sued their uncle for trying to take over the family company and the feud began.
That’s where one of the brother’s sons, the ex-CEO ATD, comes in. More than offering great benefits like profit-sharing and keeping employees around for 20 or 40 years, many employees have come forth and said that ATD really cared about them, no matter their position within the company.
According to an article in The New York Times, ATD’s generosity and compassion extends to attending important events in his employee’s lives. “He’s been to my kids’ weddings, my mother’s funeral, his sisters came to my mother’s funeral, to my brother-in-law’s funeral,” said Michael King, the company’s controller.
Meanwhile, Arthur S.’s moves have been interpreted by some of Market Basket’s employees as trying to get more money out of the business and into the shareholder’s pockets; money that might be relinquished at their expense. Changes in management always bring about fears of lay-offs, changes to the pay structure and possible cutting back on benefits.
