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Washington Post: An ousted CEO so popular employees protest to get his job back

The Washington Post

July 23. 2014 8:12PM
A Hudson Market Basket employee held up a sign in front of the Lowell Road store Wednesday afternoon, eliciting a loud honk from a passing truck. (April Guilmet/Union Leader Correspondent)

Employees protest over many things: higher wages, better benefits, safer working conditions in their jobs. What’s far more unusual, if not unprecedented, is to see workers, organized by senior managers, stage a rebellion to help their CEO get his job back.

Yet that’s just what has been happening at Market Basket, a 71-store grocery chain based in the Northeast. Thousands of employees of Market Basket, which has locations in New Hampshire, Massachusetts, and Maine, have held rallies over the exit of their chief executive, Arthur T. Demoulas. “Artie T.,” or “ATD,” as he’s called by employees, was ousted in June by a board that’s controlled by his cousin, the similarly named Arthur S. Demoulas.

For decades, the company has been embroiled in a family feud that has spilled over into not only an unusual battle aligning management and rank-and-file employees against the board, but a public relations crisis and an election year topic for local politicians.

“It’s quite remarkable,” says Ashley McCown, president of the Boston-based communications firm Solomon McCown & Co. The momentum that’s built around the story, she says, hasn’t “just been a one day thing,” she says. “It’s been going on well over a week. It’s one for the crisis playbook. Any of the commentary I’ve heard from lawyers and academics and labor experts is that this is unique.”

What would inspire such loyalty, especially in a world where CEOs are increasingly viewed as an out-of-touch group of 1 percent-ers and the corporate social contract feels as if it’s all but disappeared?

A CEO that has a track record of paying above-average pay and benefits, for one.

But in speeches, blog posts and media reports, employees spoke of the former CEO’s integrity, accessibility and generosity. He was known for attending the weddings and funerals of employees’ families. “He’s George Bailey,” says Tom Trainor, a 41-year veteran of the company who was a district manager of 37 stores before he was fired Sunday, comparing Arthur T. to the fictional savings-and-loan manager from the film “It’s a Wonderful Life.” “He cares more about people than he does about money.”

Trainor, who says the protests are a completely grass-roots effort, described Arthur T. as being more comfortable walking his stores, talking with employees and customers, than he was in the office. On the first day the company opened its first store in Maine, “it took him 4.5 hours just to get in the building because there was a line of customers and employees out there. He took time to speak with every one.”

Daniel Korschun, a professor of marketing and fellow at Drexel University’s Center for Corporate Reputation who has been studying Market Basket for a case study, attended the rally on Monday.

He heard employees talk of Arthur T.’s visits to employee family members in the hospital.

“He seemed to be fairly involved in people’s lives, and I think he was a big believer in being a low-cost provider to communities.”

Korschun became interested in studying the company for the uniqueness of its story.

“The employees and the customers — they see themselves as the organization,” he says.

“The board and the new CEOs are seen as the outsider. It’s the exact opposite of what you usually see.” In reputation management, he says, the effort is usually on protecting the image of the company and the brand.

But in this case, the reputation damage “is not to the company. It’s to the board and the new co-CEOs. Market Basket’s brand itself is really quite strong right now.”

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