Welcome to a brand-new episode of FOMO Sapiens. In this episode, host Patrick McGinnis sits down with accomplished MIT Sloan School of Management Professor and best-selling author Zeynep Ton. Zeynep's extensive research and expertise in creating sustainable, successful companies that offer good jobs will captivate and inspire you. Ton's big idea from her first book "The Good Jobs Strategy" is that providing good jobs is a choice, even for low-cost retailers. It challenges the conventional wisdom that low wages and high turnover are necessary for profitability. Instead, Zeynep argues that these practices are more expensive than we may think. Her latest book delves deeper into the reasons why companies should make the choice to offer good jobs and provides practical insights on how to do so. Throughout the episode, Zeynep explores two key lessons that she has discovered through her research. Firstly, she reveals that paying employees low wages and operating with high turnover can actually cost companies more in the long run by generating hidden costs like lost sales and low productivity. Zeynep presents compelling evidence that changing to a good job system is not only less risky than commonly believed, but also yields positive financial returns. Zeynep also emphasizes that creating a good job system isn't just about human resources - it's about winning in business. She underscores the importance of investing in people, paying them enough, so they can focus on their jobs, and positioning your teams for success. Elements such as meaningful work, respect for employees' time, and trust in their decision-making abilities are key components of a good job. This approach not only benefits the workers but also increases productivity and contributes to overall company success. In the episode, Zeynep acknowledges the changing nature of the workforce due to advancements in AI and automation. She expresses concern about the prevailing belief that people can easily be retrained for different jobs, and highlights the pressure on employers and companies to respond to technological disruptions while still creating good jobs. She believes that technology doesn't happen to us; we have agency in how we respond to it. Drawing from real-world examples, Zeynep showcases how companies can adapt to a good job system and thrive in the face of change. One such example is Sam's Club, Walmart's wholesale club. Before 2017, Sam's Club was underperforming and falling behind Costco. However, a new CEO implemented key changes, including investing in employees by raising wages and implementing stable schedules. Reducing product variety also improved employee productivity and customer satisfaction. By leveraging technology to enhance and empower employees, companies can create better jobs and increase customer value. Zeynep reveals that even business school professors are at the forefront of exploring how capitalism can be improved. The rise of mission-driven companies allows customers to align their values with the businesses they support. Zeynep emphasizes that customers have a role to play in the conversation about what good jobs should look like. This engaging episode also explores the power of entrepreneurship and starting from scratch to create great companies. Zeynep shares the story of Jim Synagel, who started Costco in Seattle 40 years ago. By paying double the industry average for employees, Costco built a great team and achieved remarkable success. The key, Zeynep argues, is having conviction and creating a strong system from the beginning. Join us for this thought-provoking episode, that challenges the status quo and offers practical strategies for companies to embrace the good job model. Discover how companies can thrive in a changing world and create sustainable growth while prioritizing their most valuable asset - their employees. Don't miss out on this insightful conversation!
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