These are my notes from John Mackey’s luncheon remarks about Whole Foods and creativity on November 1, 2011, at the 2011 Oklahoma Creativity Forum. Today’s program is available in PDF format. John is the co-CEO and co-Founder of Whole Foods Market. MY THOUGHTS AND COMMENTS ARE IN ALL CAPS.

John Mackey at #okcf2011

I believe creativity is intrinsic to human nature
– we need to nurture it and encourage it in your organizations

fear, command and control, and bureaucracy all short circuit creativity

purpose, decentralization, empowerment, authenticity, transparency, love, care, trust, innovation, and collaboration are all cultural patterns

fear-based leadership is antithetical to creativity

Longer talk on conscious capitalism
– higher purpose, stakeholder orientation, conscious leadership, conscious culture

conscious culture
– purpose is key: businesses need to shift focus from profit maximization to purpose maximization

What is the purpose of a business?
– what is the purpose of most professions
– if all professions have a purpose that relates to the public good, why doesn’t business?

If you ask the purpose of a doctor, no one says “to make as much money as possible”
– purpose of a teacher isn’t to maximize income: it’s to educate people
– even with lawyers: they teach in law school lawyers promote justice and fairness in a democratic society

why is just business put in this box of being profit seeking
– this kind of narrow focus for businesses has given business a bad name
– it’s because business doesn’t explain the value it creates in the world

who defines the purpose of any business?
– it’s the entrepreneurs who create the original business purpose
– entrepreneurs of the conscious business are also entrepreneurs of meaning
– businesses flourish over the long term when they evole their purpose to higher levels of complexity and meaning
– purpose unleashes creativity and innovation

THe power of purpose

Ray Spense quotation” the differences you’re trying to make in the world drives everything you do, matters to all stakeholders, is your reason for being that goes beyond making money….”

Great companies have great purposes
– the highest ideals that humans aspire to

The good, the true, the beautiful, the heroic

strategies, processes, and structurs reinforce the higher purpose and conscious leadership

Southwest Airlines is a great example of a service oriented airline that is highly creative and innovative

The good: service to others, improving health, education, communication and quality of life
the true: discover and furthering human knowledge
the beautiful: excellence and the creation of beauty
the heroic: courage to do what is right to change and improve the world

The Container Store is another great example of a company that

Do you realize Google didn’t exist 13 years ago
– their higher propose – to organize and provide access to the world’s information, has a huge impact on the world
– companies like this have discovered truths about humanity that help carry us forward

businesses can be highly creative, interested in art and beauty
– Steve Jobs and Apple as an example

Warren Buffet’s company as another example: Berkshire Hathaway

Heroic: Bill Gates
– 1st at Microsoft, now at Gates Foundation

Microcredit loans

REI: reconnecting people with nature (higher purpose beyond profits)

What great purpose will Whole Foods fulfill in the next 20 years
– raise consciousness about the principles of healthy eating: whole foods, plant strong, nutrient dense, healthy fats
– radically improve the health of people in the US, Canada, the UK, and other countries
– help millions of people prevent and reverse the lifestyle diseases that are primarily killing us: heart disease, stroke, cancer, diabetes, and obesity
– help change our health care system to focus on prevention of disease through diet and lifestyle, rather than drugs

Authenticity
– leadership has to walk the talk
– what you DO matters far more than what you do
– creativity doesn’t flourish without authenticity
– authentic self of individuals is encouraged and valued
– authentic communication with honesty and integrity: not spin

Ever wonder why a lot of people do not like politicians?
– they don’t always tell us the truth (Oklahoma politicians excluded)
– it’s very discouraging to hear our Presidents lie to us
– they are taught to do that because they are taught the American public can’t handle the truth
– we send people through “media training”
– Americans hunger for authenticity and truth from our leaders

Our company is highly decentralized
– when you centralize power at the top, you aren’t allowing creativity of people to flow throughout the organization
– decision-making authority and innovation potential are located throughout the entire organization and as far down as possible, usually at the regional and store levels instead of at the global level

Empowerment goes hand in hand with this
– self-managing work teams that make their own decisions regarding hiring, selection and many of their products, merchandising, compensation, etc.
– teams are highly motivated and empowered to serve our customers well

We get an engaged, team-ember base that is the secret to our success at whole fools (combining empowerment and decentralization)

Too much of corporate America acts like the military with idea sharing: only on a need to know basis
– transparency helps trust, innovation and collaboration
– transparency with all stakeholders
– all relevant financial info is shared with team members, including compensation
– we tend to over disclose

Love, Care and Trust
– studies show people will not be creative when they are afraid
– love, care and trust are essential to allow people to flourish
– in a lot of business, love is seen as weak
– we use military metaphors: we’re going to ‘roll over those guys’
– macho, masculine culture and statements often views tough as better than love
– I’ve found life to be exactly the opposite

Love is the most powerful force in the universe
– to fully unleash the creativity of others, people cannot be afraid
– story of Jack Welch at GE: firing 10% of people every year who had the worst performance reports
– when people are playing it safe, they are not going to be innovative and creative
– people have to feel they are cared for in the workplace to be creative
– when our team members feel someone at their workplace cares about them, they can bring their entire creative self to work

reference to the book FLOW: when we are preforming at our highest creative level
– leadership must embody love and care in actions
– trust given = trust received

Whole foods market has a culture of innovation
– we are structured to create it, recognize it, reward it, and spread it
– in today’s hyper-competitive world, the only lasting competitive advantage any company has is an ability to innovative
– this is especially true for a company like us that doesn’t hold any patents (esp for us when we’re competing against organizations like Wal-Mart)

our secret sauce: innovation with collaboration
– innovation without strong collaboration is far less valuable and useful
– key to collaboration is sharing successful ideas and innovations everywhere within a company, spreading them quickly, and allowing them to be improved upon
– Whole foods market has a strong culture of collaboration
— new store innovations are encouraged, failures are not punished, but simply eliminated
— successful innovations are studied and quickly adopted by other stores and regions, which in tur continue to innovate and improve them

Story of whole foods market now moving into the bar market through a success at one store in providing a tap room for local artisan beers

Conclusion
– creativity is intrinsic to human nature, we need to nurture it and encourage it in hour organizations
– fear, command and control, and bureaucracy all short circuit creativity

big government is not going to figure out how to solve our problems
– all kinds of entrepreneurs are going to… going to unleash creativity to solve problems we haven’t discovered or thought of yet

It’s up to young generations today to solve problems that my generation hasn’t’ been able to solve yet
– the young don’t know yet what they can’t do
– your creativity (as young people) has to be given to the world to solve the problems we face

FEAR, bureaucracy, and command and control structures all stifle creativity
– government often has all these (ME: AS DO SCHOOLS)


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