by Sarah Kalloch and Zeynep Ton
Workers at grocery stores, pharmacies, convenience stores, and other “can’t-close” retail businesses are working overtime and risking their own health to keep the rest of us in food, medicine, and toilet paper. The companies they work for need to take care of them in order to keep both them and us safe.
It isn’t easy to balance well-stocked shelves with the safety of employees and customers, and there isn’t much time to learn. So there will definitely be mistakes along the way. But based on our research and work, we think the operational practices and values of the retailers we call “good-jobs companies” can provide guidance to others. This is no coincidence. The various things that good-jobs companies do differently from other companies are all designed to make their frontline employees so valuable and productive that their contributions more than repay the greater wages, benefits, and training they receive. The resulting dedication and adaptiveness are exactly what companies need in order to cope with the Covid-19 pandemic.
Below are some of the practices of good-jobs companies—in particular, Costco, Mercadona, H-E-B, and Mud Bay—that can be adopted to keep customers and employees safe right now.
Some retailers are experiencing peak demand around the clock, which makes it hard to maintain social distancing and to make time for safety procedures such as sanitizing shelves. Normally, cleaning a dusty shelf may not be as important as tending to the 100 people lined up at the checkout. Right now, however, it is. So now is the time to reduce workload by rationalizing the product line, limiting shopping hours, and clearly explaining why you’re doing so to customers (so they don’t bug the employees) and to employees (so they can explain to customers).
Mercadona, Spain’s largest grocery chain, has instructed staff and has used social media to tell customers to shop quickly, to have only one person per family in the store, and not to hoard. Costco closed its food court, optical department, and hearing-aid department. It is not accepting returns on high-demand items like toilet paper, paper towels, Lysol, and rice—both to simplify work and to discourage hoarding.
Given the virulence of Covid-19 and the difficulties of maintaining and enforcing safety precautions, especially in retail stores with hundreds of anxious shoppers, reducing the risk to zero is impossible. That said, retailers need to create and communicate clear standards for sanitizing stores, distribution centers, and trucks; for social distancing; for handwashing and personal protection; for surveillance to identify potential illness in employees; and for new ways of working (for instance, switching from huddles to different modes of communication, or creating smaller work groups in distribution centers).
Companies with high employee turnover and weak unit managers with short tenures—a description that fits most retail chains and online retailers—will have a hard time adhering to safety standards. Good-jobs companies, on the other hand, already excel at creating and conforming to strong standards by using input from the front lines and then providing those front lines with the necessary tools and enough time. Costco, for example, has strong, empowered middle managers and dedicated frontline staff who all take high standards seriously. That puts Costco in a strong position to enforce novel and strict standards related to closing every other register for social distancing and limiting the number of members who enter. At Mud Bay, a pet store chain in the Northwest, door greeters ask customers to wash their hands at an outdoor station before entering the store and to stay six feet apart once inside. Staff are empowered to ask a customer who refuses to practice social distancing to leave the store.
Covid-19 will call for new everyday work processes and will not wait around for a cautious rollout. The continuous-improvement culture at good-jobs companies enables them to innovate faster and better. Early in the pandemic, Costco, Mercadona, and H-E-B, for example, placed plexiglass in checkouts to keep employees safe. Costco repurposed the plexiglass from seafood displays. Mud Bay quickly rolled out curbside pickup, which went from 0% of sales to more than 6% in five days. CEO Lars Wulff said his stores could do this quickly because of a stable workforce that was already empowered to make decisions. This is crucial, because many stores have different setups and local customer needs.
Good-jobs companies staff their stores with more hours of labor than the expected workload, which enables them to react to changes in demand or supply. Given the increase in customer demand and additional callouts due to illness, operating with slack is especially important now. It isn’t just Amazon that’s suddenly hiring in a big way.
Companies may also need to repurpose roles to create more capacity. H-E-B, a Texas supermarket chain, is adding an extra manager in charge of Covid-19 response who ensures that the stores are sanitized twice a day, maintains regular food sanitation, and monitors lines at food counters and checkouts to ensure social distancing.
Good-jobs companies also operate with financial slack. This means making sure they have the money on hand to deal with unforeseen events. In 2008, when the world economy was collapsing, Mercadona had enough cash on hand to pay bonuses to its workers. Its leaders knew they were going to need to ask more of those workers as the company innovated to cut prices for struggling customers. Retailers are asking even more of their employees now.
Respect is not a luxury when you’re asking people to risk themselves. It is time for all retailers to show respect by prioritizing workers’ safety, offering decent pay and benefits, giving them the tools and resources they need to do a good job, and recognizing them when they do. Good-jobs companies already do that, but Mercadona is now boosting pay by 20%, and Mud Bay, H-E-B, and Costco (which already pays among the highest wages in retail) are paying workers two dollars more per hour during the crisis. An empowered Costco warehouse manager in Massachusetts is providing meals for his team. QuikTrip’s CEO is visiting stores to show solidarity, recognize good work, and communicate that their jobs are safe (but adheres to recommended social-distancing and sanitizing practices while doing so). Home office leaders at Sam’s Club are taking shifts in the stores to support their colleagues, which may also help them better understand the pressures of operating in this kind of environment so they can craft stronger policies moving forward.
All these interventions to keep customers and employees safe cost extra money in the short term. Mercadona is giving out gloves to customers and hiring private security guards to help with crowd control and take some of the load off store managers. Good-jobs companies are able to implement these changes more quickly because they already have a culture of doing the right thing and prioritizing people over shareholders.
A Costco employee told us, “The dedication and drive that Costco employees have sets us apart from everybody else. During these times, our true colors have really shone.” That dedication and drive didn’t just spring up under pressure. They are the carefully cultivated results of a specific set of practices. If Covid-19 draws attention to the long-term value of good-jobs practices, it will have had at least one positive impact.
TAKEAWAYS
One of the biggest challenges that essential retailers face is keeping their workers and customers safe from Covid-19. Learning along the way, adhering to strong standards, and dedication to maintaining safety are essential. Studying the longtime practices and values of a group of model retailers, including Costco, Mercadona, H-E-B, and Mud Bay, can help companies ride out the storm:
Adapted from “How Can’t-Close Retailers Are Keeping Workers Safe” on hbr.org, March 30, 2020 (product #H05IKO).