How did ousted Market Basket CEO Arthur T. Demoulas inspire such loyalty from his employees? Historian Nancy Koehn explains.

Credit: Rupa Shenoy / WGBH News

Demoulas Family > King Lear: Harvard Historian Nancy Koehn On Market Basket

July 29, 2014

There are dysfunctional families, and then there are dysfunctional families. The Demoulas Clan -- the founders of the Market Basket grocery chain whose explosive and public family feud over control of the company recently culminated in the ouster of the chain's CEO, Arthur T. Demoulas -- fits squarely into the latter category.

"I honestly think Shakespeare, in putting together King Lear, had nothing on the Demoulas family," says historian Nancy Koehn of the Harvard Business School. Yet, she continues, the fierce show of loyalty from Market Basket employees protesting his departure -- many risking, and in some cases, even losing their jobs in the name of putting Arthur T. back in charge of the company -- suggests the mark of a CEO who was highly valued by his employees. Koehn broke down which business practices make employees loyal to a CEO.

  1. Visibility. Successful CEOs frequently and regularly make themselves visible to their employees in a credible, non-gimmicky way. That means if you're the CEO of a grocery chain, for example, your employees working the checkout line or bagging asparagus for customers should be able to pick your face out of a police lineup. Showing up once a year for the company holiday party doesn't count.
  2. Communication. Unlike children in the Victorian era, good CEOs should be both seen and heard. Communicating in a variety of forums on a regular basis  is key (and that's genuine, face-to-face communication, "not emails or mission statements in bathroom stalls," Koehn says.)
  3. Singling people out. A good CEO doesn't forget that employees are individuals. When Starbucks barista Sandie Anderson donated a kidney to a regular customer, Starbucks CEO Howard Schultz made sure everyone knew it. "Do you know how much loyalty that engendered from his workforce?" Koehn asks.
  4. Good wages and compensation. A no-brainer, for sure, but good wages and benefits send the message to employees that their labor is valued. 
  5. Opportunities for advancement. Koehn points out that many of the people protesting Arthur T.'s ouster most vehemently had long histories of employment at Market Basket. "Don't think that's incidental to people's sense of connection to Arthur T. Demoulas," Koehn says. "You have to believe your future is tied up with a company. That is simply not true with huge numbers of public companies today."

"These are just a short list of things you must be doing credibly and from your heart as well as your head," Koehn concludes.

For more from Harvard historian Nancy Koehn on the continuing saga of the Demoulas clan and Market Basket, tune in to her full interview on Boston Public Radio, below.

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