The CSR Newsletters are a freely-available resource generated as a dynamic complement to the textbook, Strategic Corporate Social Responsibility: Sustainable Value Creation.

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Friday, March 1, 2013

Strategic CSR - Tesco

I am not in charge of the largest supermarket company in the UK, but if I was, I don’t think I would treat my employees like Tesco does:

“There’s a fine line between micromanaging and house arrest, and British grocery store chain Tesco seems determined to cross it. According to the Irish Independent, employees at the company’s Dublin distribution center are forced to wear armbands that measure their productivity so closely that the company even knows when they take a bathroom break.”

I understand the attractions of monitoring and measuring employee performance in order to maximize productivity, but I find it hard to believe that at least one Tesco executive didn’t stop to consider whether constant vigilance would do more to demotivate employees (reducing productivity) in ways that offset any incremental performance benefits gained by collecting these data:

“The armbands … keep track of how quickly and competently employees unload and scan goods in the warehouse and gives them a grade. It also sets benchmarks for loading and unloading speed, which workers are expected to meet. The monitors can be turned off during workers’ lunch breaks, but anything else—bathroom trips, visits to a water fountain—reportedly lowers their productivity score.”

I am not sure what is worse—that Tesco is experimenting with this technology or that it might even work:

“In recent years, Tesco has ramped up its productivity. From 2007 to 2012, the average number of full-time employees in a standard 40,000-square-foot Tesco superstore reportedly fell nearly 18 percent.”

Of course, as the article notes, speed and efficiency is not necessarily the same as quality:

“Tesco is one of the major retailers currently embroiled in Europe’s ever-widening horse meat scandal. When it turns out that the box frozen spaghetti Bolognese contains 60 percent horse meat, it doesn’t really matter how quickly it was unloaded from the delivery truck.”

I am sure that Frederick Taylor would be flattered at the extent to which his ideas have been pursued. As the great man himself said:

“Hardly a competent workman can be found who does not devote a considerable amount of time to studying just how slowly he can work and still convince his employer that he is going at a good pace.”

Have a great weekend
David


Instructor Teaching Site: http://www.sagepub.com/strategiccsr/
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Tesco Monitors Employees With Motorola Armbands
By Claire Suddath
February 13, 2013
Bloomberg Businessweek