A Business and Co-operative Future For Weaver Street Market By Geoffrey Gilson docx

“Informal Intimacy”:
A Business and Co-operative Future
For
Weaver Street Market

Geoffrey Gilson
August 2007
Introduction – Policy Governance

I have been with Weaver Street Market (WSM) for something over two years now. About
a year ago, I began formulating some thoughts about the future structure of WSM, both as
a business and as a co-operative. This document represents the sum of those ideas. I don’t
pretend that the document is a detailed blueprint. I merely offer it as a trigger, to help start
a conversation among the stakeholders in WSM.

Let me say straight away that my style is informal. So, I apologize upfront if this
document does not read like other policy development strategies or organizational
evaluations you may have read. Indeed, it may seem a little rough around the edges in
parts – I was more concerned with getting something out, than making it all polished and
streamlined.

If this document is being read by someone who is not grounded in WSM or policy
governance, then it’s probably a good idea first to read through the WSM website
(www.weaverstreetmarket.coop
), and in particular, the sections entitled “About Us”
(www.weaverstreetmarket.coop/about/index.php

) and “Become an Owner”
(www.weaverstreetmarket.coop/owner/index.php
).

The John Carver Policy Governance model (www.carvergovernance.com/model.htm
)
provides opportunity for what may seem to some like an endless intellectual discussion
about the balance between ENDS (www.weaverstreetmarket.coop/about/wsm.php
and
www.weaverstreetmarket.coop/about/coops.php
) and MEANS; whether a Board should
be prescriptive, or merely exclusive (about results that are undesirable); the full extent of

the monitoring function; and so on.

As interesting as that discussion may be for Retreats, Board meetings, or just chats over
coffee (!), what it means to me immediately is that I’m not entirely sure how to go about
raising thoughts (my own) which have been brewing for some time, and which some may
see as a full-blooded, up-and-down revamp of the corporate and co-operative structure of
WSM and its Board.

Do I submit all of those thoughts in one go, or in parts? Under this item, or that? During
policy review, or monitoring? Well, rather than give myself an excruciating (and
undoubtedly self-sustaining!) migraine, I have decided that the easiest thing is simply to
lay out my thoughts all at once, and let time and natural process (organically) do the

remainder.

This way, you know what is in my mind, and you can decide for yourselves what you
want to discuss, and what not; and when; and how.

I would apologize for the length of the document, but I have a lot I wish to address. If I
didn’t think it important, I wouldn’t be saying it. You may not agree with it, but that does
not mean I’m not passionate about it. The way I was raised was simple: if you believe
something, believe it vigorously. But believe it without disrespecting the views of others.

And what is it exactly that I believe so passionately? Well, in a nutshell, in the two years
that I’ve worked at WSM, I’ve become particularly interested in what can be done

structurally with WSM to retain the ‘small co-op’ feel after all the expansion that is
underway.

Specifically, I’ve wondered whether the MEANS/ENDS John Carver Policy Governance
model, as originally adapted by WSM for use when it was just one unit in Carrboro, is
still rigidly applicable to a co-op that is now aggressively becoming both multi-unit and
multi-million.

Everything evolves. The organic movement, the sustainable movement, even the co-
operative movement – all have evolved in the past twenty years. As has the size of WSM.
Wouldn’t it be a little crass immediately to assume that everything else evolves, but we
shouldn’t look to see if our policy governance structure also should be evolving?

Now, the answer, after a deal of worthy discussion, may well be ‘leave it all alone.’ But,
surely we should at least have a wide-ranging conversation to see if there are ways that
we can modify our policy governance structure, within the model set by John Carver,
such that it becomes more responsive and more accountable?

And before the purists run screaming for the hills, let’s not confuse ‘structure’ with
‘model.’ I’m not suggesting that we move away from the John Carver Policy Governance
‘model.’ I’m suggesting that we review our policy governance ‘structure,’ to ensure that it
is still commensurate with the John Carver Policy Governance ‘model,’ in a way that
maximizes responsiveness, accountability and internal communication, within the new
circumstances that WSM finds itself.

Responsiveness and Accountability

I think we can all agree that Weaver Street is so much more than just a grocery store. It is
more than a corporation; it is a co-operative. It is more than just a shopping stop; it is a

community events center. It is more than just a bottom line; it is a social statement and a
pressure group for those statements.

I would not presume to produce a document that reviews every aspect of what makes
Weaver Street so…Weaver Street! Perhaps a little boringly (!), I limit myself pretty much
to discussing corporate and co-operative structures and policies.

However, it could be argued that they represent the most important aspect, since they
provide the vehicle within which all the rest is able to travel safely.

Leaving all the grand philosophizing to one side, and in my humble opinion, the
structures and policies that make a co-operative corporation truly effective are those that

allow for maximum responsiveness and for meaningful accountability.

I believe, for example, that every single person associated with a co-operative corporation
should be accountable to someone. And that includes customers. They should be
accountable also. Which may sound a tad radical. I’ll come back to that specific point
later in this document. But, let me expand a little upon the responsive/accountable theme.

We are fond in Weaver Street of graphics to make a point. So, imagine if you will a chart
that is circular, when talking about lines of responsiveness and accountability. Not just
vertical.

Worker obviously is accountable to management. Think of workers being on the outside

of the circle. Now, management should also be responsive to workers. Both should be
responsive to customers and consumers, who are beyond the edge of the circle.

As one moves inside the circle, one moves up the management food chain, until we reach
the Board. Each level of management is accountable to the level above, and should be
responsive to the level below. Finally, senior management should be directly accountable
to the Board (which, again, may be a departure from where we are at the moment – and
again, I come back to that later).

The Board should, of course, be responsive to the needs of the co-op. but it’s more than
that. And here we not only move back out again, but also into a third dimension (blimey,
sounds like “Hitchhiker’s Guide to the Galaxy, doesn’t it?).

The Board is accountable not only to the owners (both consumer and worker), but it
should also be responsive to all workers and to all customers. So should every level of
management – and worker.

I’ve read and re-read this section, and ended up asking myself, ‘what am I trying to
convey?’ I think the answer is this: when contemplating this document, don’t allow
yourself to compartmentalize the workings of WSM too much.

The Board is not separate from management, and management separate from worker, and
worker separate from owner, and owner separate from customer – and then back again!
We are all organically linked, in relationships that work in many different directions.

Now, if I haven’t completely lost you, hold those thoughts, and let’s examine the context
in which I believe all this responsiveness and accountability works best – namely,
“Informal Intimacy.”

“Informal Intimacy”: The Essence of Co-operation

Look, I could jabber on for pages about charts, and lines of responsiveness and
accountability, and definitions of co-operation. But the fact is this. What makes
responsiveness and accountability work in a co-operative – what makes a co-operative
such a great corporate structure in principle – is immediacy.

When Weaver Street was just one unit in Carrboro, people came in every morning and
immediately saw their bosses. Management immediately saw the Board. If a customer
had a complaint, they could make it to the person responsible immediately. There were no
lines of authority. Everything was as ‘local’ as you could get. Owners, customers,
management and workers all in the same small box.

There was little need for formal structure and endless planning and reams of documents.
Everything could be achieved over cups of coffee. This is the essence of “Informal
Intimacy.” I know I oversimplify, but the point is still good. A co-operative works best
(and this is what makes co-operatives such a potentially dynamic form of corporation)
when matters can be addressed informally, casually, by a couple of people talking
intimately.

Naturally, as one grows from one unit to three, and now to five, that immediacy – the
informality, the intimacy – is lost. One has to rely more upon documentation and reaction
to provide response and accountability all around the circular graphic.

The primary thrust of this document is to examine what we can do to recover as much of
that informal intimacy as possible. And if we can’t, what we can or should be doing
instead.

Now, let me say right here, you may vigorously disagree even at this stage. Great! This is
a discussion document. If it provokes someone into coming up with something radically
different, so much the better.

Let’s start at the bottom of the ladder. Oops. Misspoke. I mean the outer edge of the three
dimensional circular graphic. With our loyal workers – of whom, of course, I am one.
Department Intra-action

It is sometimes a little too easy to sit in the sanctity of a Board meeting, put forward a
policy item, and assume that ‘operations’ (the MEANS side of things) is some Borg-like
apparatus (sorry about the constant sci-fi references), which instantly knows, as one hive,
exactly how to implement the policy, all the way around the chain of command.

In the same measure, it is all too easy to assume that one man, the General Manager,
when reporting during monitoring, is able to speak with one voice, with total and

complete knowledge and understanding of all that happens under his command and why.

I have enormous respect for our General Manager, but I think he would be the first to
leave omnipotence to the Almighty! Every link in any human chain (or circle!)
is…well…human. And it is subject to all the subjective foibles of humanity. As we used
to say about computers, the information out is only as good as the information in.

So, is there something we can suggest that would help our General Manager (and the rest
of the operations management) in their job of gathering information? And which would
also help our workers and Worker-Owners better to understand what the Board is saying
– at the sharp end!

I think that there is. And I believe it to be particularly apposite, bearing in mind the
expansion. Back to the concept of Informal Intimacy…

When we were one unit, managers and our General Manager could get a sense of what
was going right, and what wrong, what people felt, whether policy was properly being
implemented, and the like, by a hands-on walk-through the one co-op unit every morning.
Or whenever.

More and more, as we expand, and senior management and the Board become more
‘remote’ from the sharp end in every unit – as time presses – so it is that we have to rely
more and more on ‘remote’ and ‘reactive’ management tools. Such as the Mystery
Shopper Report – a brilliantly conceived, but still impersonal, decision-input mechanism.

Or co-worker performance reviews. And so on.

I wonder whether a more immediate and more effective means of two-way
communication might not be more department meetings?

From my own perspective, I think that every department would benefit from having at
least one department meeting every two months. That they need be no longer than one
hour in length. And that at least half of each meeting could be set aside for workers to
raise their own points. So that they are not merely management-presentation sessions.

Management could get across figures. Workers could be ‘educated’ in matters flowing
from the Board. They would also have an immediate and informally intimate forum in

which they would increasingly feel more relaxed about sharing their true feelings about
what was going on. This, in turn, would provide the General Manager with invaluable
raw ‘intel’ so as to be able more informatively to report back in the monitoring process.

It could be argued that the management chain provides all the ‘intel’ that the General
Manager should need. And that management manages by managing, not by collective
discussion and action.

I would say that management has its own imperatives that are not the same as workers’.
And that while we are not a collective, a co-operative is not just an ownership model; it is
a business and an economic model too. Employed properly, co-operative principles and
practices, including an element of democracy in the workplace, can assist in departments

being more effective, and maximizing their contribution.

It is workers who are the primary point of retail inter-action with the customer. They are
the ones who truly represent the values of the co-op to consumers. The Board should
want to ensure that their input is received, that their views are valued and respected, and
that they, in turn, are fully prepared, in every way, to act as ambassadors of WSM the
grocery experience, and WSM the co-op.
Annual Co-op Meeting

Every fall, there is a meeting of all of the workers in WSM. It lasts a couple of hours, and
to be honest, and perhaps naturally, bearing in mind the increasing size, spread and
complexity of WSM, it has become more of a management-presentation session, than a

further opportunity for workers to give feedback (ultimately to the benefit of the Board’s
monitoring function), and to feel that they are participating democratically in the affairs
of their co-op.

I would suggest that half of this meeting be given over to matters raised by workers. And
that those issues be decided by a suggestions and voting process before the Annual
Meeting.

I think it very important that those involved with our co-op be given a real opportunity to
make decisions from time to time. It is not enough that they are consulted. A suggestions
box is not participatory democracy. And in that same vein, I think it important that those
present at the Annual Meeting be allowed to vote on something, and feel that the vote is

in some way binding on someone.
Open Forums and Consultation Exercise

The previous section was written before the Annual Co-op Meeting of August 27, 2007.
A short while prior to that meeting, I sent an e-mail to Human Resources, a copy of which
is included in the Appendices to this document.

I was delighted that the questions in that e-mail were the first to be read out at the
meeting; that our General Manager answered both questions in the affirmative; and that
he kindly suggested that the agenda of the meeting was in response to those questions.

Whatever else may happen, I am proud that, even in this small way, and while still only a

candidate for Worker-Owner Director, my suggestions may have made some small
contribution to improving the communication structures within WSM.

For the first time, the Annual Co-op Meeting incorporated a full half-hour of open and
direct questions and answers between co-op workers and senior management.

That suggestion was expanded upon with the proposal for monthly open forums. It is my
hope that these might complement department meetings and a revival of the Worker-
Owner Program, which I discuss some more in the next section.

I agree that it would be useful to have these open forums address specific issues, so that
attendees may know beforehand what it is they will be discussing. At the same time, I

hope it will still be open to employees simply to raise points once they are there.

At the Annual Co-op Meeting, I made the point that it would be helpful to have the
appropriate senior management present at each open forum, so that matters raised could
immediately be addressed by those responsible for resolving them.

My theme throughout this document, and with my actions over the past year within
WSM, has been to encourage meaningful two-way communication, response and
accountability. The open forums will achieve little if they are merely opportunities for
worker ‘grunts’ to talk to each other.

By the same token, I agree that it might be useful to have independent moderators at the

open forums. WSM already uses the services of a meeting facilitator for its Board
meetings.

More than that, I believe it might be helpful if notes are taken, and then distributed to
senior management and Board members, so that as many people as possible, up and down
the ‘ladder,’ are informed of feelings within the co-op. Indeed, it wouldn’t hurt if Board
members were to attend, and even address the odd open forum.

The final part of the communication jigsaw that the General Manager mentioned at the
Annual Co-op Meeting (and which was first raised in my own election address, written
and published before the meeting) was the desire to have a ‘conversation’ before June of
2008 (the 20

th
anniversary of WSM’s foundation) about where we all want WSM to go in
the next 20 years.

I take the view that it is important that this ‘conversation’ involve as many stakeholders in
WSM as possible. Bearing in mind that WSM is so much more than just a grocery store –
it is a community icon, that anchors life in Carrboro – it is not unreasonable to want a
‘conversation’ that pretty much includes the whole community.

I would invite the Board to take this ‘conversation’ under its wing, and to set up a task
force, first to expand on the ‘conversation’ and design around it a full-blown consultation
exercise, and then to implement that consultation exercise in the months leading up to

June 2008.

I see no reason why that task force could not include leading members of the local
community, who might not otherwise have a direct and current involvement in the
operations or governance of WSM.

The consultation exercise could work hand-in-hand with the Owner Programs, the open
forums, the Marketing Messenger, the WSM Newsletter, the local media (both formal
and informal – forums and blogs) and special meetings of residents and customers.

I would suggest that the marketing department set up a simple blog, on a server such as
Blogger.com, to allow ongoing discussion by all stakeholders on all manner of topics

I would hope that the Board and WSM might find some of the matters raised in this
document to be worthy of consideration in that consultation exercise, as potential
component parts of WSM in its evolution over the next 20 years.

I apologize if it seems a little disjointed to have this section tucked in here. But I wrote it
after the rest of the document. And I really couldn’t work out where else to put it…

*****

…on which point, let me continue the disjointed theme by including some comments on
the first open forum, as it was announced in the Market Messenger of September 6, 2007.

I was impressed with how quickly the first open forum was arranged. We all kind of lost
our way in 2007 communication-wise. The Annual Co-op Meeting, held on August 27,
2007, was a great first step in reversing that trend. And this first open forum continued
the positive approach to opening up our co-op. I hope that my various ‘missives’ over the
past 18 months may have played some small part in that process.

I think it important that we make the forums as inviting as we can in every way possible –
in terms of their being easy to attend, and in encouraging participation. We will have
made no progress at all if these forums merely end up being one-way feedback sessions
for Human Resources. If they are to serve the purpose intended, they need to foster
genuine two-way communication between workers and the management members

responsible.

On that latter note, I found the first open forum, as advertised, a tad formal and
intimidating, when I would have been looking for more informal and intimate. Personally,
I would prefer store-wide forums. There is a hint of divide-and-conquer about separate
unit forums. Workers, who might otherwise not speak up, will probably find safety in
numbers in larger meetings. In any event, it facilitates open communication and
transparency if we are all in one place, able to hear what everyone else is saying.

I think we night have gone a little too far with the specific topic angle. I believe the sense
was that workers wanted to be able to give advance notice of matters they would be
raising so that the appropriate management could be present. I don’t think the idea was

that management alone would set the agenda, or that they alone would get to pick a topic
from a selection submitted. At the very least, I think it should be made clear that workers
may also send in other topics, and/or raise them at the forums under an Any Other
Business item.

I certainly hope that we are going to pick up on the point that senior management should
be present to make it genuine two-way communication. I would suggest that both the
General Manager and the Operations Manager make it a point to attend every open forum.

Worker-Owner Program

Now, it is not the case that workers have no input at the moment. They can become
Worker-Owners, and express opinion through the Worker-Owner Program and their
Worker-Owner Directors (www.weaverstreetmarket.coop/working/benefits.php
).

Again, I’m going to be blunt, without being disrespectful. I don’t think there is one
individual associated with the workings of WSM who is not multi-task. It is
understandable that we cannot all have our eyes on every ball at the same time.

The fact is that the Worker-Owner Program has not been as active as it could have been.

As part of its monitoring function, the Board might want to examine this aspect. Is more
support staff required?

For myself, if I end up submitting this document as a Worker-Owner Director, I will be
making my e-mail and a blog available to all Worker-Owners, and I will be holding
regular meetings, so that Worker-Owners can express their frustrations, their ideas, their
input to their two Worker-Owner Directors directly – immediately, intimately and
informally.

At all costs, we want to avoid a repeat of a situation where Worker-Owners feel that the
only way that they can be heard is to take their grievances to the media.

I will deal later with compensation for Directors. However, Worker-Owners depend upon
their hourly wage to survive. You are not going to get too many Worker-Owner Directors,
of excellent quality, on a regular basis, if you are essentially asking them to do the work
of a Board Director for free.

We have an expression in England: you pay peanuts, you get monkeys. The Board has
been fabulously lucky to have the quality of service it has received from all of its
Directors, including its Worker-Owner Directors. We take the continuation of that
excellent service for granted at our and the co-op’s peril.

I leave this section with this thought: We look to our Worker-Owner Directors to be an
immediate, informal and intimate link with our workers, the sharp end of our co-

operation. That takes time and dedication, and that is money out of pocket for people
receiving less than a living wage.

We spend more money on our Mystery Shopper Program, which impersonally monitors
the performance of our workers, than we do on paying our Worker-Owner Directors to
inter-act on a personal level with those same workers, find out what they are thinking and
actually help to inspire them to work better.

Is this really the best use of our resources in meeting the ENDS set by the Board? Is this
truly the best way of encouraging our work-floor ambassadors to represent Board policy
the best way that they can?
Consumer-Owner Program

I know little of the way the Consumer-Owner Program works
(www.weaverstreetmarket.coop/owner/benefits.php
), or whether it is working well. I do
know that I have heard anecdotal evidence that some Consumer-Owners feel a little out
of touch these days.

There is an Annual General Meeting of WSM. Although all Owners are entitled to attend,
essentially it is the annual platform that allows Consumer-Owners to have their input.
Maybe, there should be an effort (perhaps by the elected Consumer-Owner Directors) to
hold more regular, informal and intimate meetings with Consumer-Owners during the
course of the year?

In conjunction with suggestions I make later about the accountability of senior
management and the structure and functions of the Board, I think it would be appropriate
for both the General Manager and the Operations Manager to make reports to the Annual
Meeting. There should be votes on those reports and a vote upon the presentation of
accounts.

In any company with a turnover of $20m (and rising) with which I have been associated,
it has never been enough that Owners, shareholders, whatever, get to listen to what has
been happening. They are always given the opportunity to engage in regular votes of
confidence. It ain’t a democracy if you don’t get to say “nay” once in a while – and the
“nay” is allowed to have some direct effect.

And while we’re on the subject of ‘democracy,’ as some point I think it would be
worthwhile to debate and consider whether WSM is employing a sufficiently inclusive
definition of ‘stakeholder,’ when considering voting matters within WSM.

If all we are about is money, then should WSM be a co-operative at all? For sure, there
are both workers and consumers who feel disenfranchised at the moment, simply because
they can not afford the current price of entry to the ‘voting club.’

Is it reasonable to separate capital raising from the ability, as a more broadly defined
stakeholder, to take part in decision-making within a co-operative we promote as the
community’s grocery store? Should the financial be set apart from the social aspect?

Collective Executive Management

The clarity of lines of communication and authority laid down by the John Carver Policy
Governance model require that there be one focal point of contact between ENDS and
MEANS; policy and operations (implementation).

We currently have an annual turnover of $20m. The concept of the General Manager as
focal point was conceived when we were one, much smaller unit. We will soon be five
units, spread over three towns. It is not inconceivable that, in a very few years, we may
have an annual turnover of some $30m.

We have already concluded that this is all too much for one focal point when it comes to
managing the implementation of policy around three units. That’s why an Operations
Manager was appointed. I am concerned that this new focal point, with immense personal
authority for implementing ENDS, is not as accountable as perhaps he should be.

Is it really fair that we ask one other man (the General Manager), on top of all of his other
burgeoning responsibilities, to be solely responsible for second-hand (not immediate and
not intimate) reporting to the Board on operations compliance?

And what of expansion? What of geographic spread? Will there be further delegation of
operations responsibility around the co-op and Orange County? With more focal points of

authority and responsibility, becoming ever more remote from the source of policy?

Is it appropriate for the Board to review the axis of senior management? To re-cast the
role of General Manager? Perhaps around a collective executive? Which would function
within the John Carver Policy Governance model as a ‘collective’ focal point?

Give each member of the new collective executive clearly defined job responsibilities
within the collective executive? Perhaps, with a rotating schedule of reporting to the
Board? So that the collective executive, not just the General Manager, is immediately and
intimately accountable to the Board for implementation of policy?

Might this bring the sharp end of implementation closer to policy-making? Might it make

operations more accountable? Might it make the Board more intimately aware of the
matters over which it presumes to speak with knowledge?

Might it re-introduce to the ‘focal point’ an intimacy and an immediacy that we had when
the Board met in a room right next to the work-floor, and Directors could chat with senior
operations management on their way to and from Board meetings?

Hang on, you might say, aren’t we just re-inventing the wheel here? Not really. The John
Carver Policy Governance model would have failed a long time ago if it wasn’t possible
to adapt it to different circumstances. We at WSM find ourselves in different
circumstances to those when we were just one unit. What I am proposing is different to
what existed when we were just that one unit, but it is all within the philosophy of the

original John Carver Policy Governance model.

The strict rules of separation were appropriate for everyone occupying one small space.
Perhaps even necessary. Much like the Japanese having rigid codes of conduct, so that
they do not interfere with each other’s very confined space.

However, when one expands to fill five units, many miles from each other, the rules of
separation…well, they do just that…they separate. We all have to make a conscious effort
to reach over the separation to stay in touch. And I’m not sure we’re doing that at the
moment.

So, I think we need to mix it up. To think about changing the rules and creating new

structures that still adhere to the original John Policy Governance model and which help
us to recover the easy communication, responsiveness and accountability that we had
with the original one unit.

It may seem a little messy at first. Even frightening. But, with respect, I think that’s as
much a part of a ‘teenage’ co-op growing as it is with a teenage kid growing up.

Executive Board Function

My premise here is that the job of overseeing implementation of policy and then reporting
back on progress to the Board is too immense for one man. We have already accepted that
much of my premise by the appointment of an Operations Manager.

I further believe that the job may become even more complex and burdensome with the
growth to five units, and their spread over three different towns.

I think it unavoidable that a collective executive of some description will evolve. I just
want to be sure that there is some design to that evolution (and somewhere there was a
joke about ‘intelligent design’ and ‘evolution,’ but I missed it!).

I would offer this much as part of that evolution. I do not think the Board need necessarily
involve itself with the specific design of operations responsibility within this new
collective executive, but I do think that it could consider pulling back into itself the
executive function of monitoring.

That would free the new collective executive to focus on implementation, while allowing
the Board to become more intimate with an operation that is expanding away from it. And
I think this can be done in a way that operates fully within the precepts of the John Carver
Policy Governance model.

I would see all of the collective executive being directly responsible to the Board, for
each of their clearly-defined job responsibilities. I see no muddying of clarity here,
because I would see each of the collective executive also sitting on the Board. In addition,
they could have their own collective meetings, where they would prepare for Board
meetings, and then meet afterwards to plan co-coordinated implementation.

In addition to reports from the collective executive, I think it only appropriate for the
Board also to receive overall co-op financial reports at each Board meeting. Not every-
day sales figures, no. But compliance with budget and cash flow estimates, yes. The latter
goes hand-in-hand with a more intimate and effective monitoring of overall co-op
compliance with Board policy.

And I stress ‘overall.’ I do not see this new Board monitoring effort interfering with the
freedom of the General Manager and his expanded collective executive to operate as they
see fit – provided it is within ‘stated Policy Guidelines’ (love that expression). I do not
want to see the Board becoming intricately involved in the minutiae of every day
operations. Either we trust senior management, or they get fired.

I think the John Carver Policy Governance model visualizes the Board as not so much
being on top of the co-op food chain, as to one side. Set apart. Protected. Where it can
consider co-op policies (and their most idealistic possibilities) unsullied by material and
operational exigencies.

Within that visual concept, the need for just one focal point of contact with the rest of the
co-op is not only desirable, it is crucial.

The role of that focal point (our General Manager) is not so much to act as liaison
between ENDS and MEANS as it is to be the protector of the integrity of the Board.

To determine what the Board needs to be able to remain ‘pure;’ and to filter out whatever

it is that the Board decides and which the General Manager feels may be irrelevant or
even harmful to the every day reality of the food retail experience in the remainder of the
co-op.

This worked fine in WSM when it was a one unit, informal and intimate co-op. When the
Board was an adjunct to the workings of the retail co-op. When it was set to one side,
rather than on top.

With expansion, however, there is a need for the Board to be ‘on top’ – in so many
different interpretations of that expression.

You cannot reasonably have a publicly owned, multi-million dollar, grocery chain where

senior management is not directly accountable for its operations to a Board of its Owners.

That Board needs to be ‘on top’ of what is happening in the co-op, so that it is able to
make relevant and informed decisions.

It is way too much to ask of one man that he be the sole point of contact between
operations and policy, between ENDS and MEANS.

It is probably not the best governance model, in a multi-million dollar and multi-unit co-
op, for responsibility for both implementation and monitoring of that implementation to
be in the same collective hands.

That is why I visualize a collective management executive, with responsibility for
implementation, and accountable for that executive function to the Board.

That is why I visualize a revamped Board, with new executive authority for overseeing
compliance of policy.

And that is why I visualize this as an appropriate evolution of WSM’s interpretation of
the John Carver Policy Governance model.

Isn’t this all so complicated, you might say? Yes, it is. We ain’t a neighborhood co-op no
more. We’re about to be a multi-million dollar chain store. We just managed to make it
all the more complicated, all by ourselves.

‘Ends’ Responsibility

One of the great features of the John Carver Policy Governance model is that it allows a
group of people concerned about the co-op, who bring special skills and outlooks, to
review the workings of the co-op, ‘uncorrupted’ by too much attachment to the everyday,
‘material’ distractions of the grocery business.

Now, of course, we don’t want the Board to be so set apart that it is living in an ivory
tower. And I’ve been addressing that. But we want to find some way of retaining that
pristine policy input, and in a way which, if possible, returns some immediacy and
intimacy to it.

In more corporate-style, multi-million dollar businesses, at least in my experience as a
management consultant, this function is mixed in with the executive function of the
remainder of the Board.

There are executive Directors, who run and monitor, and there are non-executive
Directors who also monitor and then produce policy.

The non-executive Directors are generally chosen for skills which complement the
business, and may not otherwise be found among the executive Directors. Sometimes, the
non-executive Directors meet separately, and report back to the main Board. And John
Carver specifically allows for and encourages this concept.

I have a few suggestions.

The Chair should continue to be one of the elected Consumer or Worker-Owner
Directors.

There could be a new post of Vice Chair. This would be an appointment, and the person
would be chosen to be a ‘beacon’ to the community in which WSM is immediately
interested.

I borrow here from my experience as Chair of the Board of Trustees of a community
theater in North Georgia. We were a start-up. We needed to raise several tens of
thousands of dollars very quickly.

I suggested for my Vice Chair that we appoint the principal of the local private school,
who had just completed an effort to raise some $22m. for new school buildings. He and I
then approached his single largest donor – a founding Director of Home Depot – to be our
new Fund-raising Chair. And our fund-raising took off from there.

With all this expansion, we are having to concentrate a lot of our efforts on raising capital
and loans. Perhaps, we could have a Vice Chair who could act as a similar beacon to
potential capital and loans, say, in Hillsborough?

I am very impressed with the strength of our appointed Directors. Perhaps, in due course,
and with our becoming a much larger co-op, we might think about adding to their

numbers with people who are specifically expert in co-op finance and/or natural food
retail co-op management and policy?

We may want to think about increasing the number of Consumer and Worker-Owner
Directors, and introducing some element of geographic election?

With the specific retail operating functions of the General Manager and his collective
executive on the increase, it may be that other co-op related activity, such as the Co-
operative Community Fund, which at the moment is the responsibility of the General
Manager, in future, should report directly to the Board?

With all of this new responsibility of the Board, it may be that the only way to find time

for and to protect the nature of policy discussion and policy monitoring (as opposed to
operations monitoring) is to remove them to a separate Policy Governance Committee,
made up of the non-executive Directors, and reporting back to the main Board.

This would retain the essential philosophy of the John Carver Policy Governance model,
where policy discussion and monitoring are kept separate from the operational side of the
corporation, and are allowed to take place ‘uncorrupted’ by the everyday, ‘material’
distractions of the grocery business

I mentioned earlier about reviewing the specific compensation of Worker-Owner
Directors. I think we need to review the compensation of all Directors. Whether we
design it or not, their workload is going to expand as WSM expands – even without

implementation of the suggestions in this document.

In my opinion, if we want the best, we need to pay for it. Volunteering only goes so far in
an ever more expensive world. We don’t ask Consumer-Owners to volunteer away their
discount…

I believe that this evolving interpretation of “Ends” Responsibility retains the
philosophical strength of the John Carver Policy Governance model, while adapting
WSM’s unique policy governance structure to the realities of being an expanded co-op,
with more units, spread over a wider geographic area. It helps to re-introduce immediacy,
intimacy and a measure of informality in all of our decision-making, responsiveness and
accountability.

Five Co-ops

There is, of course, a radical alternative, which would allow us to retain WSM’s original
interpretation of the John Carver Policy Governance model – in its entirety – and to
restore to it the informal intimacy that I believe to be the essence of good co-operative
practice.

We could divide WSM into five, stand-alone co-ops, each with its own separate
membership and Board, and all working together co-operatively.

If Carrboro was able to stand on its own two feet, and to function as a successful business
and co-op, then why not these five new co-ops?

I think it might be useful to invite representatives from, say, Co-operative Development
Services to help (at the very least) with consideration of this and the preceding two
sections, if the Board thinks it appropriate.

Whatever else might be the case, we would be considering radical co-operative
developments, and help from any knowledgeable quarter should be welcomed.
Minority Issues

One area where I would like to see WSM and its Board (or the new co-ops…) more
responsive and accountable is the whole area of minority issues.

I am personally concerned that there are not more residents of color shopping at our
outlets, and represented in our workforce.

I am concerned that none of my Hispanic colleagues put forward their name in
nomination for Worker-Owner Director.

I am concerned that we spend a lot of time railing against cheap-goods, big-box stores,
but then we do little to encourage the working poor, who need such stores to survive, to
shop with us.

Frankly, I’m concerned that, even with a 20% employee discount, so many of our own
workers buy their staples from other stores – and I include myself.

The original co-ops in England were founded to allow employees and consumers to
escape the company store. My fear is that we may have become the company store.

If we have, and that is what our Consumer-Owner want, then we should respond to them
democratically, and provide them with what they want.

And along the way, we should probably abandon all pretence of being a co-operative, and
set ourselves up formally as a full corporate-style company, with shareholder meetings,
reports and votes.

Personally, I think we want to remain a co-op. And I would like to see the Board address

minority issues by carefully examining the ENDS, and working out whether it is specific
enough on minorities, price and hardship.

There are many individuals and organizations in this town, with whom I believe we
should strike up a more meaningful dialogue, to ensure that we are meeting their
expectations of us as a leading commercial, community entity.

Donations are not enough. Do they feel a part of their local, community-owned grocery
store?

Are we doing enough to integrate our Hispanic staff into our family? Are we reaching out
to our new friends, through the many community organizations that exist to welcome

them to our town, and to help them transition? There are many, but El Futuro
immediately springs to mind.

We have mentioned, from time to time, that as a commercial concern, appealing to a
particular demographic, we realize that we have contributed to a change in the character
of Carrboro. But are we doing enough to help ease that transition for our hone town?

Frankly, I become worried when I hear that ‘affordable housing’ means a $100,000 house.
‘Affordable housing,’ for those who service the Carrboro Creative Economy and now
perhaps LOIS, means being able to afford to house a family of three kids, on $9 an hour,
in rented accommodation – when rent is ever increasing, due to the pressure from UNC
college students, who have parents with deeper pockets.

We need constantly to keep pay and benefits for our staff under review. We should be
ahead of other grocery stores, and should always be keeping an eye on what is genuinely a
living wage. That way, to be perfectly mercenary, more of our staff might then be able to
shop in our stores.

Should we be considering more assistance, or at least the provision of information, with
regards to helping employees who have specific hardship cases? Help with health
insurance? Help with Worker-Ownership?

One matter that I have been asked to raise is considering the provision of child-care
services. We have more than one parent in WSM struggling to meet their commitments to

WSM because of the need to have their kids looked after. Should the Food House and the
revamped Carrboro store have nursery rooms and qualified attending staff, at the very
least?

At this point, I want to mention one group of people specifically. Without being in any
way derogatory of every other single worker in WSM, everyone in our Human Resources
Department is doing a magnificent job.

Their combined input truly makes an enormous contribution to our collective efforts to
identify ourselves as a genuine co-operative in our outlook, our practices and our concern
for human dignity.

Nothing that I say here is to denigrate their efforts. Rather I am asking the Board to
consider if there are ways that we can help them be even more excellent in their vocation.

As a community organization, it is not enough that we look after our own workers. We
need to give consideration to all the workers in our community, not least the working
poor.

I think it safe to assume that we stock what we stock because it sells. It would be
foolhardy to second-guess retail operations in what should be bought. It would be equally
nonsensical to micro-manage the prices we charge for those goods. As much as I’d like to
be able to compete with Wal-Mart on price.