Progressive Grocer - November/December 2009 - (Page 64)

Independents Report Big ideas for the smaller grocer Relative Worth Fairly compensating family members who work for their companies can be tricky for independent supermarket owners — unless they adopt a strict “business first” philosophy. food for thought regarding pay systems: • First, establish written job descriptions and measurable performance goals for each position ne of the most challenging areas within your store. to manage within the inde• Pay for performpendently owned supermarket ance and determine is the compensation paid to what each position in the individual stakeholders. This is company is worth in your often an emotional topic at family meetings, as individual marketplace. many storeowners find it difficult to establish differ• Seek assistance ent rates of pay for relatives working in their busi- from an outside nesses. board of advisers in To operate with the utmost integrity and gain developing a writthe respect of one’s entire staff and management ten pay system. team, however, compensation for most family mem- According to bers must be individualized and determined not Eldred, estabonly by position within the organization, but also by lishing an advieducation, experience, ability, personal time com- sory board whose mitment to the company and overall job perform- members aren’t paid ance. and assume no legal According to Dr. John Eldred, who consults responsibilities, with family-owned businesses across the country isn’t enough. through his Ambler, Pa.-based company, Transi- “Typically,” tion One Associates, compensation within family he says, “those who businesses is too often designed not to promote are paid for their services, which can include attendcompetence, but to avoid conflicts. ing quarterly review sessions and participating in “Of course, it’s human nature for parents to owner meetings and conferences, view their posistrive to treat their kids equally,” notes Eldred. “But tions more seriously and can provide more benefit to when it comes to the workplace, not every job is the organization.” worth the same amount of money, and not every rel• Incorporate within the organization a phiative contributes equally to the organization in losophy of “business first.” “Operate the stores terms of energy and talent.” as a business in which family members work,” advises Eldred. “Avoid compensation being viewed Be Objective by siblings as an indication of the amount of love What an owner must establish early on in a fam- and power that parents bestow upon each child. ily business is an architecturally sound pay system. Pay must be based on quantification, not emotion.” “Owners must have the ability to separate ownership • Conduct ongoing performance evaluations. from management,” explains Eldred. “Unfortu- Eldred urges that all associates, including family nately, there are some business members, must participate in the More ONLINE owners out there who are either performance appraisal process. For additional information too lazy to figure out what indiHe suggests that parents enlist on independent viduals are worth, or they have no the help of their board of direcretailers, go to guts to confirm the truth.” tors to evaluate individual famProgressivegrocer.com Eldred suggests the following ily members. “This lends objecBy Jane Olszeski Tortola O tivity to the process,” he observes. “Drawing a line between family and business is certainly not easy, but it’s essential in order for both family members and the company to earn respect. It proves to all employees that every associate, whether they are related to the owner or not, must earn their own way in the system.” Additionally, Eldred believes that by basing pay exclusively on job classification and performance, future leaders have the opportunity to develop efficacy and a true sense of competence — not entitlement. “At all costs, we must avoid entitlement, a psychological condition in which family members believe that they are owed something by virtue of their last name or relationship to the owner,” he says. “We can accomplish this by continuously focusing on effort and outcome within the organization.” As an example, he offers: “If a bonus or reward is presented to a son or daughter who hasn’t earned it, credibility is destroyed. Sure, the parents may feel good about giving that bonus, and the child is no doubt happy to accept it, but what the parents/owners don’t realize is that they’re contributing to others in the organization viewing their child as a joke.” During his years as a respected industry consultant, Eldred says he’s found no issue that causes greater conflict than money. “We have to remember that there’s good conflict and there’s bad. And fair does not always mean equal.” Independent Retailing Editor Jane Olszeski Tortola can be reached at JanieOT@aol.com. www.progressivegrocer.com • Progressive Grocer • November/December 2009 A H E A D O F W H AT ’ S N E X T http://www.Progressivegrocer.com http://www.progressivegrocer.com

Table of Contents for the Digital Edition of Progressive Grocer - November/December 2009

Progressive Grocer - November/December 2009
Contents
Nielsen’s Shelf Stoppers/Spotlight: All Departments/Ramen Noodles
Progressive Grocer’s Category Captains Awards: Recession Planning
Consumer Insights: Innovate to Differentiate
Independents Report: Determining Relative Worth
Lempert Report:The Trends That’ll be Tops in 2010
Store of the Month: A New Brand of Winn-Dixie
Beverage Alcohol: Glass Half Full
Sports/Energy Drinks: Energetic Sales?
Category Management: Categorical Shifts
Holiday/Super Bowl Meat Promotions: Bowled Over
PG’s Annual Deli/Bakery/ Prepared Foods Roundtable: Bringing Value to the Table: Part 2
Packaging Trends: Sheer Innovation
Price and Promotion Optimization Software: Optimization Plus
Signage: Above and Beyond
What’s Next: Editors’ Picks for Innovative Products

Progressive Grocer - November/December 2009