– December 12, 2020 Reading Time: 7 minutes

It’s a source of endless irritation for my wife, but Whataburger is usually the first subject I bring up when introduced to someone who lives in Texas, or is from there. It also comes up when talking with friends who still live there. Breakfast at Whataburger would be my “Death Row” meal, and it’s what I tell all Texans with utmost sincerity.

What irritates my wife will perhaps surprise readers of this book review. You see, this one analyzes Conscious Leadership, the excellent new book by John Mackey, and his colleagues Steve McIntosh and Carter Phipps. Mackey is an ethical vegan, but more importantly he is the founder of Austin, TX-based Whole Foods. How odd for a writer who plans his trips to Texas around Whataburger visits to be reviewing a book by the creator of a business who arguably created the healthy eating movement.

So while Mackey and I would almost certainly order different things if we were ever sitting across from each other at a restaurant, there’s broad agreement on matters of public policy. Mackey believes capitalism “is the greatest thing humanity’s ever done,” and I agree with him. When he writes, I read. Conscious Leadership was a great read.

Probably the best place to begin is to start where Mackey and his co-authors do: it’s the early 2000s, the initial internet boom was heading toward a healthy bust (the previous truth eluded politicians, regulators and most media members, but that’s another column), and the bust took Whole Foods’ internet concept WholePeople.com with it. The failure of WholePeople imperiled Mackey’s spot as CEO, and it brought him to Florida where he would make a case for being retained as CEO in front of the company’s board.

Rather than pace the floor of a hotel room or run numbers, Mackey chose to rediscover Whole Foods itself. He visited a nearby store. The latter reminded him that his creation was “beautiful stores filled with smiling team members.” Mackey found his “own purpose renewed,” but also realized that his own “leadership style had to evolve.” Since that fateful walk of the aisles Whole Foods’ annual sales have soared from $1 billion to $19 billion as Mackey and the team he rebuilt stepped up “to a much higher level of integrity and responsibility.” Conscious Leadership was one of the informative results of this Mackey’s journey.

Mackey’s reminiscence of a more troubled time is firstly a crucial lesson about “recessions.” They’re a good thing. Bad times set the stage for much better precisely because they force us to look inward, to fix what we’re doing wrong, and to think hard about ways to improve. Regarding the previous sentence, it should exist as a reminder that what tens of millions of Americans are enduring right now is not a recession. Recessions are healthy. What way too many Americans are suffering right now is a forced contraction whereby economic freedom was replaced by command-and-control. In Mackey’s case, bad times planted the seeds for better.

Fast forward to the present, and Mackey has thankfully been very publicly against the hideous lockdowns that have bankrupted millions of U.S. businesses, and put tens of millions out of work. And when it’s remembered that the only closed economy is the world economy, the lockdowns have brought on disastrous implications of the poverty and starvation kind for a world very much reliant on American dynamism.

As for me, Mackey’s reminiscence of troubled times didn’t just work as powerful evidence of the curative power of downturns. It also helps explain my interest in Mackey’s book beyond our policy agreements. While my dietary choices probably wouldn’t impress the author, or authors, I’m always made giddy by a walk through Whole Foods. The stores are surely beautiful, and as my wife is a big fan of healthier, more sophisticated food, I’m at Whole Foods several times a week. The stores energize those within them given their vibrancy, and the team members are most certainly always smiling. Better than their smiles is how helpful they are. No matter what item asked about, and no matter how far it is from where it’s asked about, team members always make time to walk me over to what I’m looking for. And since Whole Foods has an expansive selection of meats, there’s much for people with my dietary limitations too.

Mackey’s evolution, and the one he engineered within Whole Foods, was decidedly “not about market share and products.” As this introduction alludes, the reboot of his innovation was about “leadership and people,” and in particular the person in the CEO’s chair. As Mackey puts it, “an organizations potential is constrained by the abilities of its leader.” Mackey’s personal recession forced him to improve.

All of which brings us to a point-of-view that some who lean capitalist might quibble about with Mackey. It’s apparent that he at least on the surface rejects the notion that businesses exist wholly to create profits for shareholders. Stakeholder Integration is crucial in Mackey’s eyes. Better yet, it’s “a shift away from the traditional conception of a corporation, in which increasing profits for shareholders is seen as the primary responsibility of the businesses. Instead, we think of businesses as serving a wider community of stakeholders, all of whom are connected through mutual interests and benefits.”

Some who are capitalist in orientation might read the above and immediately be triggered in the figurative sense. The view here is that their ire would be wasted. Mackey isn’t rejecting profits as much as he’s saying that the path to rewarding shareholders is very much one in which various stakeholders are rewarded first.

Mackey believes great leaders “connect people to purpose.” The purpose of Whole Foods is to “nourish people and the planet.” In shifting the stated mission from profits to something bigger, or as Mackey phrases it, something “vivid and exciting,” he’s energizing the very people and customers who will ultimately reward shareholders.

Mackey’s view of the world doesn’t just apply to businesses. Indeed, it would be great if more politicians and economists would read his book. “Vivid and exciting” is operative here when it’s remembered that witless economists routinely make a case for what is usually a pretty daft policy idea by talking in terms of what it might mean for “GDP growth.” Ok, not only is GDP a hopelessly backwards way of measuring economic progress, it’s also a total bore. Economic growth that is always and everywhere a consequence of free people is an exciting thing, it’s a beautiful thing, so make it that way. Connect people to it.

In much the same way, more than a few who lean right politically have taken to saying about their ideological enemies that “they offer handouts, while we offer spinach. We can’t win.” Whenever I hear that, I either write an op-ed rebutting such a view or I tell the individual expressing such nonsense to try some other vocation. Think about it. Government spending is the economy-sapping process whereby Nancy Pelosi and Mitch McConnell plan the allocation of resources instead of Amazon’s Jeff Bezos, FedEx founder Fred Smith, and yes, John Mackey. In that case, if allegedly right leaning political types feel tongue-tied when making a case for spending cuts, then it’s rather apparent they have no clue why they’re for limited government, for capitalism, or realistically both. The main thing is that for those who believe in economic growth and limited government, Conscious Leadership is a reminder that winning arguments are the ones that vivify the genius of politicians consuming less so that entrepreneurs can experiment and innovate more.

Mackey also rejects the perception that business is a Game of Thrones episode. Through his eyes, business is more “an expression of love in action” It’s serving others. A “servant leader prioritizes the needs of others,” and derives authority from doing just that. This isn’t about kill or be killed. Mackey asks who but “a very brave or foolish person would climb into a tank of hungry sharks?” This read beautifully. Mackey’s not out to vanquish other grocery providers as much as he’s in this so that he can lead customers in a new direction. Peter Thiel would obviously appreciate his point of view in that Thiel too has long marveled at businesses that would rush toward competition. Why? Why look for fights? A true entrepreneur leads. Steve Jobs didn’t build another Blackberry with the original iPhone; rather he created something entirely different. Customers followed.

Mackey writes that “as leaders, we are only as good as our teams.” Some will read this as trite, or clichéd, but it’s true. There’s a reason the best companies put so much effort into building cultures, that Goldman Sachs is so heavily focused on developing “culture carriers,” that Pixar is, and that any corporation with designs on greatness is. Mackey may be a one-of-a-kind visionary, but Whole Foods is a consequence of remarkable people brought together by the visionary. About the people who make up corporations, Mackey writes that businesses “depend on interacting networks of actual people – engaging, refining, inventing, imagining, sharing, and building on one another’s work.” What Mackey is implicitly stating is that all this nonsensical speculation about the end of office buildings as workers retreat to their houses, apartments and WiFi connected Zoom meeting brings aggressive new meaning to ridiculous.

Successful businesses don’t invest enormous sums in office space as a vanity play. In truth, they do so because a neglected corporate culture quickly develops “toxic” qualities. Mackey argues energetically that an “organizational culture is a bit like a garden – it takes careful tending to turn a patch of soil into an abundant, verdant, flowering, productive ecosystem.” Readers and writers would be wise to file away the myriad opinion pieces about the end of the office. Those who would make such a ridiculous claim have plainly never worked for a good company.

In considering culture, it has to be remembered that this essential book is about leadership, and Mackey’s view that leadership heft as it were is derived “from the heartfelt impulse to help.” Develop talent and talent will follow you. Mackey makes the crucial point toward book’s end that IQ is overrated, that there are “multiple kinds of personal competence.” So very true. And it speaks to the true beauty of the free trade that Mackey believes deeply in. No doubt the lower prices that spring from open markets are brilliant, but what’s truly spectacular about the global division of labor is that it shines a bright light on “multiple kinds of personal competence” that have in the past been suffocated by autarky.

John Mackey leads by finding ways to lift those in his employ who will run through walls for someone who will put them in a position to thrive. Conscious Leadership is an essential book for helping readers understand that leadership isn’t decreed as much as it’s a consequence of the would-be leader serving those around him.

Reprinted from Forbes

John Tamny

John-Tamny

John Tamny, research fellow of AIER, is editor of RealClearMarkets.

His book on current ideological trends is: They Are Both Wrong (AIER, 2019)

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