Question

What do think is Wegmans Food Markets does to keep employees on-board compared to most supermarkets? Do think investing in retail supermarket employees is sustainable? If so, how would you invest without breaking the bank? Have you ever worked at a company that had cutbacks in employment? If so, how did the company go about the layoffs and keep employees motivated for the future?

Answer 1

1. Wegman's turnover rate is one of the lowest in the industry, which is as low as 4% for its full-time employee as compared to 27% in Walmart. The company is also awarded the best place to work, for many years.

The company believed in training its employees well, paying the best, and also a collaborative effort from people of corporate offices.

For example, each employee is given 40 hrs of training before the person starts interacting with the customers. Employees are made empowered so that they do not have to consult their managers before making a decision. It also pays approx USD 5 million a year for its employee training to learn the best practices, across the world. Generous health benefits are the plus.

While, opening new stores in different regions, they kept their pay better than the market. It helped, their employees gain extrinsic motivation and lowered the turnover rate.

It was also a collaborative effort as people in the corporate offices took part in the stores. Senior leaders can be seen working as a store manager during different events, which helped them understand the business and also the problems their employees are facing while working in the store. This created a sense of empathy

2. Yes, it is sustainable as happy employees keep the customers happy and which sustain the business. Thus they should be motivated to let this happen. Here Wegman's tried it and that resulted in excellent customer service, a lower turnover rate which saved their labor cost and other expenses of hiring again.

Investment can be done organically as well. For example, training employees can be done by senior employees in a fun and interactive manner. Apart from that, they should be given autonomy where they serve the customers without asking for everything from the customers. Employees should be felt belonging to the culture where top leadership mingles with them.

The pay should also be better, as it reduces the overall labor cost. A sense of keeping the employees happy from the top management does not require a lot of monetary investment and yet keeps the employee satisfied.

3. A lot of companies occasionally cut back their hiring or lay off their employees. It usually occurs during a crisis, like in the times of COVID-19, where Uber, Airbnb, airlines company are cutting their employment size.

While a few companies have simply sent a mail, a few of them being innovative did that on a Zoom call. One that stands apart and should be recognized here is Airbnb

Airbnb had to downsize 25% of the workforce, about 1900 employees. In order to inform the employees, CEO Brian Chesky said, emphasized, felt sorry for the decision, and made their reason transparent for doing so. They also offered assistance to the employees.

For example, He said that global travel has come to a standstill and the business is hit hard. Revenues are bleak for the year. He also assured that decision is not based upon their work, as he believes that they are great and companies hiring them would be lucky.

The company also ensured a severance package, equity, health, and job support, where people would receive their base pay in proportion with the years they were engaged with Airbnb. He even put a tweet that great people are leaving Airbnb, if another company is hiring, they could get in touch with him on the email address given.

It showed the company and leadership's trust in the people, it kept them and the remaining employee motivated. Plus, considering the bad situation they were also given assistance. In this way, they kept the employees both inside and outside motivated.