The Best Little Handbook in Texas
How to make your company's employee handbook one of your most important tools.
How to make your company manual one of your most important management tools
You've got a growing company. Some of your employees have been with you since the beginning. But you've also added a number of people, and the newest ones haven't the foggiest idea of what's so special about your business. You'd like them to understand why you do things in addition to how you do them. But communicating standards -- and values -- to a widening circle isn't easy. And it takes time. What do you do?
Most small-business owners would dismiss employee handbooks as any kind of solution. Bureaucratic gibberish, they'd say, and, by and large, they'd have a point. Anyone who's ever worked for a company with a handbook -- or a policy manual, as they're sometimes called -- knows that the content is often irrelevant. They're impersonal, technical documents, written, it seems, by lawyers to protect the company -- period. If employees refer to them at all, it's seldom to learn about the purpose of the business or about the company's culture -- they're more apt to look up how many vacation days they have coming. But, as the experience of Whole Foods Market, headquartered in Austin, demonstrates, handbooks can deliver much more.
For the past five years, Whole Foods, which operates a chain of eight natural-foods supermarkets, has used its handbook in a way that bears almost no resemblance to how other businesses use theirs. It isn't a litany of dos and don'ts. Instead, it's a detailed introduction to the business -- providing information on where it came from, what it stands for, and, above all, why it exists. Among other things, the handbook talks about the organization and its operating style. It advises employees on how to advance their careers and what to expect from co-workers and supervisors. It explains their rights so they know exactly where they stand, making them less vulnerable to arbi-trary managers. It also, one suspects, makes them more inclined to support the company's game plan. The handbook even counsels workers on how to initiate changes in existing policies. More than anything, says John Mackey, Whole Foods founder and chief executive officer, "It's a tool for showing people how the business works. We want it to be their company, too."
Back in 1980 and 1981 when there was only one Whole Foods Market, Mackey, now 35, saw no burning reason to put things in writing. Operating standards were generally discussed among his 80 employees as they came up. Questions about personal behavior or employee benefits were dealt with individually, or by the occasional memo. But when Whole Foods opened its second store in 1982, Mackey, for one, felt that the pieces of information -- and the spirit with which things were done -- had to be pulled together to help new employees get their bearings.
"When people come into a business, they don't know what to expect," he explains. And he didn't feel he could look to managers to provide a complete picture since some of them would be new themselves. Invariably, he thought, things would be omitted or distorted and eventually magnified. That's why he decided to develop a handbook.
Mackey, a philosophy student before dropping out of the University of Texas, didn't think he was embarking on anything unusual, at least not at first. He gathered handbooks from other companies, mostly supermarkets of one kind or another, and assumed they'd furnish him with valuable ideas. But they were almost entirely mechanical in their approach, bulging with rules about everything imaginable. More disconcerting, Mackey recalls, was the tone. "They seemed almost contemptuous of employees." So after talking with his managers and employees about what needed to be said, and how, the first Whole Foods "General Information Handbook" was written five years ago.
Certainly there's nothing state of the art about the way the handbook looked -- typewritten text without even a chart or illustration. But the content of the original -- and the editions that have followed -- is geared to meet the needs of people who work at Whole Foods Market. There's no way the handbook could be confused with, say, what a Safeway might put out. The current edition, for example, begins with a section on the company's history and its plans to expand into California. There's a discussion of corporate philosophy: a mission statement that underlines the importance of satisfying customers while at the same time providing "team members" opportunities for personal growth. It also notes the need to earn a net profit of 3% to 6% and a 25% to 100% return for investors (some of whom, by the way, are employees).
Even in laying out company rules, there are explanations of what lies behind them, a rarity in employee manuals. Employees aren't allowed to use store parking lots, for example, and for a good reason, the handbook notes: parking is scarce. ("Never put your personal convenience ahead of that of our customer.") Where policies are a little more subjective, as with dress codes, the goal is clearly stated. ("We all are in business to serve our customers and we have no desire to shock them unnecessarily.") An attitude of respect for individuals flows through the discussion of employee benefits as well, and everything is spelled out in plain English. Mackey says whatever legal protection the handbook provides is secondary to everything else.
Within Whole Foods, the handbook is generally seen in a very favorable light -- even among veteran employees. "It gives people a good starting point," says Patrice Sullivan, an employee at the downtown Austin store. "It's a good place to learn about how things are done." At several stores, new hires take a quiz to show they understand the basics, a practice that was suggested by employees, not by management.
