By December 18, 2008 4 Comments Read More →

Wegman’s Cuts Wasted Energy and Costs, not "Wasted" Time Serving Customers

By Jason Turgeon:

In the last couple of weeks, Mark’s been hammering the midwestern grocery store chain Meijer for ruthlessly timing employees on checkout time “efficiency” (post 1, post 2). Instead of rewarding employees for delivering fantastic customer service, management is electronically monitoring checkout times and giving pink slips to anyone deemed to be “too slow” because they take the time to actually converse with their customers and make sure that everything went well with the shopping experience.

Contrast that with news this week from Wegman’s, another mid-sized regional grocery store chain. Wegman’s, which runs about 70 stores in the mid-atlantic states, put out a press release a couple of days ago touting $1.5 million dollars worth of new lighting upgrades that will cut energy use in its Rochester, NY, area warehouses by about half, with a three year payback. And as so often happens in efficiency upgrades, the lighting quality will actually improve, making for happier employees and better safety. According to the same release, Wegman’s has already done much other work upgrading lighting design in new stores and using LED lights in existing stores.

I’ve discussed at length in this blog the ties between Lean and Green, so I won’t elaborate on the obvious except to say that this has Lean implications in two ways: cutting waste (wasted energy from low-efficiency lights) and respect for people (improving working conditions by improving the lighting, as opposed to just turning off half the existing lights and letting employees work in the dark to get the same savings).

Perhaps it’s not surprising, then, that while Wegman’s is cutting costs by cutting waste it’s also ranked this year at #3 on Forbes list of best places to work. Compare that to Meijer, which doesn’t appear on Forbes list but does come in at #5387 (out of 5498) in terms of overall reputation at Vanno.com, with a dismal 4 out of 100 in employee satisfaction. And while it was easy for me to turn up lots of info about how unhappy Meijer employees are, I struggled to find anything about energy efficiency projects at the chain. The best I could do was find something called the Pacific Sustainability Index, which ranks companies based on their “environmental and socioeconomic comprehensiveness (transparency) and performance as expressed in their voluntary environmental or sustainability reports”. Meijer scored an overall D- based on its performance both in the environmental sector and in the social sector (including employee satisfaction). Wegman’s does not appear to be rated in the PSI.

So what’s the point of all this? Well, it’s the same point as always, really. Companies that focus on Lean ideas, like improving working conditions while cutting waste in energy use, inevitably seem to do better than companies that don’t.

By the way, the consumer retail/grocery sector that Meijer works in seems to be far ahead of Meijer in general sustainability issues as a whole, even if they aren’t all as good to work for as Wegman’s. See the environmental/energy work being done at Wal-Mart, Stop and Shop, Hannaford, and Target for a few examples of Lean/Green thinking creeping into this sector.

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4 Comments on "Wegman’s Cuts Wasted Energy and Costs, not "Wasted" Time Serving Customers"

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  1. Rick Bohan says:

    I very much like this article not the least because it highlights an organization that I’ve used as a positive example of good strategy, Wegman’s Grocery.

    I do have a quibble with the idea of using the example of changing lights to save energy as an example of “lean thinking”. I think it’s a great example of creative and forward thinking intended to improve conditions while saving energy, but that’s not necessarily the same as “lean thinking”.

    I’ve always contended that the term “lean manufacturing” was an awkward name that allowed organizations to think they were practicing new methods that require great discipline when what they were doing was figuring out ways to use less water,steam, gas, etc…..and, unfortunately, fewer people.

    (It’s why I prefer to refer to it as “agile manufacturing” but that’s another post.)

    Again, figuring out how to reduce the consumption of scarce resources is a valuable and needed effort. Figuring out how to change core processes so that they are more agile, more robust, more efficient, more customer-friendly, add more value, while reducing the cost of doing so (or keeping the same for that matter…improved capability at the same cost is the same as reduced cost in my book)is what lean is all about.

  2. Mark Graban says:

    Rick – you raise good points (here and on your blog).

    The terminology is one thing — do we call it “lean” or “agile.” To some extent, I’d say “who cares?” Results matter.

    But so does process. There’s “lean” in terms of reducing waste… and what Wegman’s does seems like lean in that since. Lean is ultimately about reducing waste. But Wegmans isn’t “doing Lean.” Lean is also about employee involvement and developing people. From my surface knowledge of Wegmans (and enjoying shopping there when I was in Rochester for 6 months in 1998), maybe Wegmans is a company that “gets it” and does all of the right things without it being called “Lean”?

  3. Michael Lombard says:

    Wegmans seems like a terrific company. I remember shopping there once in Syracuse, and it seemed quite nice as far as supermarkets go. Even if they don’t utilize all the principles of Agile Manufacturing, I think their focus on waste elimination and employee satisfaction should qualify them as a Lean company (it’s all semantics though).

    While we’re on semantics, under which category of “The 7 Wastes” would wasted energy fall? Is wasted energy “scrap,” which would put it in the Defects category?

  4. Mark Graban says:

    Maybe wasted energy would count like “overprocessing”?

    Like you said…. semantics.

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