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Whole Foods in Saudi Arabia:

A Company and Country Study

IMPORTANT!! STRENGTHS of PPT: Visuals to communicate important ideas; Multiple images to suggest overlapping/inter-connections of topics (Systems Approach); Excellent use of space and images so that viewer stays focused. Combined some topics such as company location, products/services, but emphasized other topics, such as company mission and economics. This strategy suggested the team spent time needed to be very clear on the purpose and organization of the PPT.

WEAKNESSES: At first glance, it is hard to see challenges in this PPT. But here are some presentation challenges. A) Use of a type font which had serifs (or little tails on the letters). This font style is difficult to read (see slide on Company History as one example). In your PPT aim to use a non-serif type, such as Callibri or Arial. B) Use fewer words than this team. Some slides had too many words. Examples: 2nd slide describing economics; slide overviewing marketing strategies. A PPT slide should offer minimum words needed to convey information. Information should be worded in phrases, not complete sentences.

MISSION

Our whole business is about making a difference – in the lives of our Team Members and the customers we serve, and in the communities and environments in which we operate.

Photos retrieved from:

http://www.wholefoodsmarket.com/sites/default/files/media/WFM_Raw%252BUnprocessed_Logo_CMYK.jpg

https://si0.twimg.com/profile_images/3262893810/f52e34b39854be3d694b9bbe409b2330.jpeg

2002

2003

2007

2009

2011

1980

1992

2001

Launches 365 Organic Everyday Value brand, the first national commodity-riced, all-organic product line in the United States.

First National Certified Organic Grocer in the US

Launches “Health Starts Here” program; US stores undergo third-party inspections and receive organic certification; Commits to supporting the Non-GMO project

Implements Global Animal Partnership’s 5-Step Animal Welfare Rating system in the United States and Canada.

Opens its UK flagship store in London

Introduces enhanced meat standards; Becomes the first retailer to introduce solar power as a primary light source; Opens store in Toronto (first location outside of the US).

Goes public on 1/23

Safer Way Natural Foods and Clarksville Natural Grocery merge to open Whole Foods Market in Austin, TX

COMPANY HISTORY

In the 1980’s Whole Foods also unveiled their “Declaration of Interdependence”. This declaration affirmed their commitment to customers, team members, investors, suppliers, the environment and local communities.

Photos retrieved from:

http://www.wholefoodsmarket.com/sites/default/files/media/Global/Company%20Info/original-store_28px.jpg

http://www.wholefoodsmarket.com/sites/default/files/styles/large/public/wp-content/uploads/2011/09/COG_1.jpg?itok=NExoQZNp

http://www.wholefoodsmagazine.com/sites/default/files/images/articles/2012/May/anniesipo.jpg

http://4.bp.blogspot.com/_k5Qi4JAPdM8/TIiWkg5fk-I/AAAAAAAAzAA/B5GfBnfXkpg/s200/Whole+Foods+market+London+Shirt+pic-1.jpg

LOCATION, PRODUCTS AND SERVICES

Photos retrieved from:

http://www.wholefoodsmarket.com/sites/default/files/styles/header_hero/public/media/Global/Company%20Info/wholefoods-corporate.jpg?itok=MphHR4tK

http://www.sheimagazine.com/blog/wp-content/uploads/2010/10/365wf.jpg

Headquarters and Flagship Store: Austin, Texas

Currently 340+ stores

Located in 39 states

8 stores in Canada

7 stores in the United Kingdom

Products & Services

Grocery

Produce

Seafood

Meat and Poultry

Coffee and Tea

Wine and Beer

Prepared Foods

Bakery

Floral

Whole Body

Pet Supplies

WORKFORCE AND AWARDS

Size: In comparison, Whole Foods competitors such as Kroger has 310,000 employees while Trader Joe’s has more than 30,000 employees.

Whole Foods Diversity Mission: Our success is dependent on the collective energy and intelligence of all our team members. We strive to create a work environment where motivated team members can flourish and succeed to their highest potential. We appreciate effort and reward results.

Photos retrieved from:

http://www.soophotography.com/blog/images_1000/2011-08-23-wholefoodsmarket2007.jpg

http://i2.cdn.turner.com/money/.element/img/1.0/sections/mag/fortune/bestcompanies/2010/snapshots/whole_foods_market__bctwf.jpg

http://sellmorebeds.files.wordpress.com/2011/12/whole_foods_market_conscious_capitalism.jpg

Size

1980: 19 employees

2013: 73,000 employees

Diversity

Minorities: 44%

Women:44%

Ranked 15 of 100 “Most Diverse Companies” (Fortune)

Offers Domestic-partner Benefits

Workplace Environment

Self-directed Teams

Training Programs and Resources

Whole Foods employees are not unionized.

Ranked 24 of 100 “Best Companies to Work For” (Fortune)

Greenest Retail Companies in the US (Newsweek)

ECONOMICS

Economic Growth (as of 9/30/12)

Sales: $11.7B

Comparable-store Sales: 8.5% increase

Identical-store Sales: 8.3% increase

Sales Growth: 24%

in first 13 weeks of

FY12 compared to

first 12 weeks

of FY11

In comparison, Whole Foods competitors recent annual earnings were estimated to be $96B for Kroger and $8B for Trader Joes.

Graph retrieved from:

http://technically.us/pictures/oliveoil.jpg

Whole Foods Sales Growth vs. Comparable Stores

Whole Foods

FY2010 FY2011 FY2012 0.11 0.11 0.13600000000000001 Comparable Stores

FY2010 FY2011 FY2012 6.6000000000000003E-2 9.1999999999999998E-2 6.6000000000000003E-2

ECONOMICS (continued)

Whole Foods attributes their success to their relationship with shareholders, which is predicated upon:

Ability to instill a clear sense of interdependence

Efforts to communicate more often, more openly and more compassionately.

Better communication equals better understanding and more trust.

Providing transparency by posting management presentations, conference call scripts, annual reports, corporate governance information and investor FAQs to their company website.

MARKETING INTERESTS AND STRATEGIES

*Allows each region/country to focus on the needs of the client.

**Whole Foods is active in the following social media platforms: Facebook, Twitter, Instagram, Pinterest, and YouTube.

Strengths

Weaknesses

Decentralized business structure

Leadership may be unaware of the business structure of smaller offices.

Products are expensive

Opportunities

Offer online ordering with in-store pickup

Become more involved in social media: management blogs, customer blogs, recipes, and incentive sales surveys

Threats

Downturn of economy

Competition of mainstream grocery stores offering more natural and organic products.

Active in social media**

Decentralized business structure*

Offers a large selection of natural and organic foods

Committed to sustainability of the environment

ORGANIZATIONAL CULTURE

Bureaucracy Culture

Mission Culture

Clan Culture

Adaptive Culture

IMPORTANT: This slide did not add value (points). Here’s why: The slide summarized theory from Daft. It did not interpret WF culture for understanding which category (s) were more useful. Photos retrieved from:

http://www.trendceteramag.com/wp-content/uploads/2010/09/d-matthis-j-mackey-1024x664.jpg

http://arbiteronline.com/files/2013/09/Robb1.jpg

http://www.goodlifer.com/wp-content/uploads/2009/09/moniquebridgetwf3.jpg

http://cdn.greatrated.com/us.greatrated.com/companies/whole%20foods_photo2.jpg

Decentralized business structure

Polices and guidelines not stringently followed

Think outside the box, while still achieving the mission!

Employees are valued, empowered and well rewarded.

High emphasis on meeting the needs of the employees as well as the customer.

Allows for the creation of change (e.g. price reduction, adapting to local neighborhood’s needs.

BUSINESS ETHICS, SOCIAL RESPONSIBILITY POLICIES AND PRACTICES

Co-CEO John Mackey on Conscious Capitalism: http://youtu.be/X-x_WuW15a0

Improving Sustainable Agriculture

By supporting organic and natural food suppliers, and giving consumers access to these products

By avoiding conventional agriculture which can negatively affect the environment via pesticide use, pollution from concentrated animal feeding operations and land degradation from expansive monoculture

Environmental Stewardship

Joined the Marine Stewardship Council, a global nonprofit promoting sustainable fishing practices to preserve fish stocks, and sells MSC-certified seafood.

Earth Day 2008, Whole Foods eliminated plastic bags from its stores, switching to entirely recycled paper, and grocery bags composed mostly of recycled bottles.

Helped initiate a 2004 lawsuit against salmon producers in order to require them to warn consumers about PCB contamination in salmon.

Removed BPA-containing products from its shelves and took steps to report and remove products with other toxins.

Caring for Communities

Commits to an annual six week campaign that donates five percent of its net profits to philanthropy.

Photos retrieved from:

http://www.capitalwraps.com/Portals/38235/images/whole-foods-window-graphics-1.jpg

http://symonesfitness.files.wordpress.com/2012/08/wpid-eat_clean_no_processed_foods_chemically_chemicals_enhanced_artificial_white_flour_sugar_he_and_she_eat_clean_motto.jpeg?w=594

Co-CEO John Mackey considers Whole Foods’ practices to be

conscious capitalism, not social responsibility

Practices

Caring for Communities

Improving Sustainable Agriculture

Environmental Stewardship

PROFILE OF CEOs

Photos retrieved from:

1. http://www.npr.org/blogs/thesalt/2013/01/16/169413848/whole-foods-founder-john-mackey-on-fascism-and-conscious-capitalism

2. http://cobe.boisestate.edu/event/cobe-speaker-series-presented-by-keybank-walter-robb-co-ceo-whole-foods-market/

John Mackey

Salary: $1 (with stock options, $70k)

Length of Service: 32 years

Served as the CEO at WholePeople.com

Member of Advisory Board at Satori Capital, LLC

Co-Founder of Whole Foods Market Services, Inc.

Co-Founder and Director of Freedom Lights Our World

Walter E. Robb, III

Salary: $500k (with stock options, $1.3m)

Length of Service: 3 years as Co-CEO (22 years with WF)

Graduated from Stanford University in 1976

Serves as a Sector Advisor for Maveron LLC

Serves on the Board of Directors for The Container Store Group and The Organic Center

Served on the Board of Directors for Potbelly Corporation

Opened Mountain Marketplace in 1971 (merged with Whole Foods in 1991)

HISTORY, LOCATION, SIZE, LANGUAGE

Located in the Middle East between the Persian Gulf and the Red Sea

H I S T O R Y

YEAR

622-1517

Mid-1700s

1745

1811

1901-1932

The Islamic calendar begins in 622, the year of Muhammad’s flight from Mecca.

Invaders attempt to control the peninsula. By 1517, the Ottoman Empire dominates.

Mid-18th century, the country is divided into separate principalities.

Wahhabi (Islamic support) movement sweeps across Arabia

Jihad (or holy war) erupts against other forms of Islam on the peninsula and succeeds

King ibn Saud, descendent of Wahhabi leaders, seizes Riyadh to become leader of the Arab nationalist movement.

Saudi Arabia is created under the dominance of the King

IMPORTANT: The slide did not name the country. Instead, the developers assumed you would know the country. More value could have been gained if the text had included “Saudi Arabia”

Photo retrieved from:

http://saudi-directory.net/saudi_arabia_map.htm

Size: 756,981 square miles

Divided into 13 provinces

Language: Arabic, English, Urdu, Farsi and Turkish

ECONOMICS AND MAJOR BUSINESS INTERESTS

Country Indicators	2009	2010	2011	2012
GNI per capita, PPP (current international $)	26,300	27,970	30,480	NA
Population, total	26,796,375	27,258,387	27,761,728	28,287,855
GDP (current US$ Billion)	429.09	526.8	669.5	711.5
GDP growth (annual %)	2	7	9	5
Life expectancy at birth, total (years)	75	75	75	NA

Dominant oil producer, and owner of the world’s largest hydrocarbon reserves

263 billion barrels, 25% of the world’s reserves

Efforts to Diversify/ Industrial Expansion

Petrochemical

The government is seeking to encourage privatization, liberalize foreign trade, and reform the investment regime.

Oil accounts for around one-third of GDP, more than 90% of the country’s export earnings, and nearly 75% of government revenues

Construction

Transportation

Finance

Communications

POLITICAL SYSTEM

*Elections and Political Parties

In 2005, local elections were held for the first time. Only male citizens over 21 were allowed to vote.

In 2011, King Abdullah announced women would be allowed to run and to vote.

There are no political parties in Saudi Arabia.

Photos retrieved from:

http://blogs.micds.org/parnold/files/2010/05/saudi-arabia-king-abdullah1.jpg

http://en.shiapost.com/wp-content/uploads/2013/05/Bahrain-Court.jpg

Monarch

Executive Branch

Judicial Branch

Legislative Branch

Council of Ministers

Shari’ah Courts

Board of Grievances

Supreme Court of Justice

Consultative Council

Appointed by the King

150 members

Serve four-year renewable terms

Appointed by the King

Serve four-year terms

Elections and Political Parties*

TRADITIONS

*The holiest season of the year, Ramadan marks dawn-to-dusk fasting with the lunar calendar used as the basis for dates of Ramadan, which vary yearly. Saudis can work only a day and are prohibited from smoking, drinking and eating from sunrise to sundown. The town of Mecca welcomes millions of pilgrims every January to observe the centuries-old Hajj Islamic ritual.

**Nepotism is encouraged and extended families live together.

***The Mutawwain (religious police) will warn visitors if they are not modestly dressed. Women may not drive a car or ride a bicycle nor show affection or speak with men in public.

****Alcohol is a bad gift choice for religious reasons and men never bring flowers to women.

***** Lunch is the main meal and according to religious practices alcohol consumption is forbidden.

Photos retrieved from:

1. http://www.religionfacts.com/islam/images/symbols/crescent-200.gif

2. http://www.ecnmag.com/sites/ecnmag.com/files/legacyimages/saudi-women-saidaonline.jpg

3. http://eidpresents.com/wp-content/uploads/2009/08/paintingdisplay6-300x209.png

4. http://www.blogcdn.com/www.gadling.com/media/2008/10/ramadan_iftar_4.jpg

5. http://www.fracturednews.com/FN-images/BrokenWing-1/saudi%20family.jpg

6. http://www.greenprophet.com/wp-content/uploads/2012/12/rsz_shutterstock_95579653.jpg

Religion

All citizens are required to be Muslim.

Major Holidays

Ramadan*

Rules for Women

Women are required to cover their bodies in face coverings and robes to respect Muslim modesty laws.**

Family Values

Traditional Food and Drink

Islam dictates family sanctity in Saudi Arabia with social structure organized into tribes and clans.***

Spicy dishes made with rice, pita, grains, bread, lentils, chicken and lamb are the traditional dictated by Islamic law. *****

Customs

Giving gifts follow Saudi rules of etiquette such as small thank-you gifts are acceptable but are not opened when given. .****

NATIONAL CULTURE

Hofstede’s Cultural Dimension Research:

IMPORTANT: The project could have added points if the developers had compared SA culture to US culture. Whole Foods is a product of US culture and a successful expansion into the Middle east needs thinking about values that are likely to be different and require more management attention, such as Power Distance.

*Saudis need explicit instructions and direction for many tasks and will provide very detailed and formal responses to requests and questions.

Power Distance

Hierarchical order; all individuals are not equal.

Individualism

Collectivistic society - decisions based on what is good for the people, all the people, of their nation

Masculinity

Places emphasis on competition, equity, and performance.

Long-term Orientation

Uncertainty Avoidance

Places emphasis on structure and rules.

No information documented

TIPS: LEADING A PROJECT IN SAUDI ARABIA

Understand Islamic law: All aspects of life in Saudi Arabia are governed by an absolute belief in the teachings of Islam and an adherence to its tenets.

No business deal will ever be discussed without referencing Islam.

Understand the culture of nepotism:

The natural order of things in Saudi Arabia is nepotism.

Businesses are characteristically family-based with strong hierarchies, the head of the organization being the oldest male representative and all senior positions are filled by family members.

Understand the culture of respect:

Age is attributed to respect and is considered honorable.

It would be beneficial to have older representatives of the company at meetings.

Visitors must display respect to older people.

Understand the relationship tree:

The CEO may not have the power to make the needed decisions if he has poor relationship at the top and is not a member of the family.

Understand managerial styles:

The expectations of a subordinate is to show initiative.

Identify & Understand!

Islamic Law

Culture of Nepotism

Culture of Respect

Relationship Tree

Managerial Styles

PRESENTED BY:

Arthur Edmonds – mission, company history, headquarters location and information about additional locations, such as # of outlets (if a retailing enterprise), or multi-national (different country) locations for producing goods and/or services; recently introduced products and/or services; best known products and/or services; photos

Ayann Johnson Bailey – workforce size, interests/encouragement of diversity of workers, and economics; PowerPoint edits

Nydia Moore – corporate social responsibility policies; profile of CEO, business ethic history; awards; PowerPoint Master

Steve Ray – traditions and lifestyle; national culture: expectations of cultural values, based on Hofstede’s Cultural Dimension Research, compared and contrasted to country where company has headquarters; tips for leading a project in Saudi Arabia

Louise Shaw-Barry – marketing interests and strategies; your team’s viewpoint on likely organizational culture using the following categories: Bureaucracy, Mission, Clan or Adaptive; PowerPoint edits

Terrail Thomas – history; location, Size and Language; economics/major business interests political systems

REFERENCES

Adler, N. J. (2008). International dimensions of organizational behavior (11th edition). Mason, OH: South-Western Cengage Learning. Mason, OH.

Compensation Information for John P. Mackey , Co-Chief Executive Officer, Director of WHOLE FOODS MARKET INC. (n.d.). Salary.com. Retrieved October 6, 2013, from http://www1.salary.com/John-P-Mackey-Salary-Bonus-Stock-Options-for-WHOLE-FOODS-MARKET- INC.html

Spotlight: Whole Foods Market. (n.d.). Fool.com: Stock Investing Advice | Stock Research. Retrieved October 5, 2013, from http://www.fool.com/investing/general/2012/09/14/corporate-responsibility-spotlight-whole-foods-ma.aspx

Geert Hofstede Cultural Dimensions (2003). Itim International. Retrieved October 4, 2013 from http://www.geert-hofstede.com/geert_hofstede_resources.shtml.

"In This Section: Business Culture in Saudi Arabia." Top Tips on Saudi Arabian Business Attitudes and Doing Business in Saudi Arabia. N.p., n.d. Web. 06 Oct. 013.

Milburn, R. (n.d.). WFM: Whole Foods' CEO John Mackey on "Rebranding Capitalism" - Penta Daily - Barrons.com. Financial Investment News - Stock Investing News - Investment News - Barrons.com. Retrieved October 5, 2013, from http://blogs.barrons.com/penta/2013/06/10/whole-foods-ceo-john-mackey-on-rebranding-capitalism/

The Political System of Saudi Arabia. (n.d.). Healthcare and Nursing Jobs in Saudi Arabia, Qatar and the UAE. Retrieved October 6, 2013, from http://www.hziegler.com/articles/political-system-of-saudi- arabia.html

The PolitSaudi Arabia - Economy and Trade of Saudi Arabia . (n.d.). Financial resources, articles, concepts and opinions from QFINANCE - QFINANCE. . Retrieved October 6, 2013, from http://www.hziegler.com/articles/political-system-of-saudi-arabia.html

REFERENCES

Top Tips on Saudi Arabian Business Attitudes and Doing Business in Saudi Arabia :: World Business Culture. (n.d.). World Business Culture :: Key information on Business Culture in the worlds leading 39 economies. Retrieved October 6, 2013, from http://www.worldbusinessculture.com/Doing-Business-in-Saudi-Arabia.html

Saudi Arabia: Maps, History, Geography, Government, Culture, Facts, Guide & Travel/Holidays/Cities | Infoplease.com." Infoplease: Encyclopedia, Almanac, Atlas, Biographies, Dictionary, Thesaurus. Free online reference, research & homework help. | Infoplease.com. Retrieved October 6, 2013, from. http://www.infoplease.com/country/saudi-arabia.html.

Walter Robb - Forbes. (n.d.). Information for the World's Business Leaders - Forbes.com. Retrieved October 6, 2013, from http://www.forbes.com/profile/walter-robb/

Whole Foods Market: Corporate Social Responsibility by Mikayla McNamara on Prezi. (n.d.). Prezi - Ideas matter.. Retrieved October 5, 2013, from http://prezi.com/lxrjtjwproit/whole-foods-market-corporate-social-responsibility/

Whole Foods Market (n.d.). Retrieved October 2, 2013 from Whole Foods website http://www.wholefoodsmarket.com/company-info

World Bank (n.d.). (Data indicators October 10, 2013). World Development Indicators. Retrieved from http://databank.worldbank.org/data/views/reports/tableview.aspx

(n.d.). Retrieved from http://media.wholefoodsmarket.com/fast-facts/

(n.d.).Retrieved from http://www.diversityplus.com/tops.aspx?id=Fortune-Names-Whole-Foods-to-100-Best-Companies-to-Work-For-List-Citing-Diverse-Employee-Mix-399

(n.d.). Retrieved from http://online.wsj.com/article/PR-CO-20130207-908915.html