1) How would you describe the merchandising and operational decisions made by Whole Foods market in terms of the rational, bounded rationality, and garbage can models of decision making?
In terms of the rational model of decision making, Whole Foods Market executives strive to optimize their merchandising and operational decisions by seeking out the best or optimal solution to problems in these areas.
For example, in making the decision to distribute only fresh and locally-grown produce, the company had to pay premium prices for certain commodities that ordinarily would have cost cheaper if freshness was not an issue. However with Whole Foods market, freshness is an issue, thus it pays premium prices to its suppliers with the rational objective of acquiring only the best farm or aquatic produce.
This decision is rational since it serves two purposes. The first is already mentioned, while the second has something to do with sustainability. Ideally if Whole Food Market pays premium prices to their suppliers for their fresh produce, such practice would sustain their businesses in the long-run, thereby assuring Whole Foods a steady supply of premium, fresh produce which caters to their target market needs.
On the other hand, in terms of bounded rationality, one can say that Whole Foods executives also adopt this model in making their decisions. This means choosing the next best satisfactory alternative since either there is no more time to evaluate all alternatives or because the company already has established rules of thumb in dealing with familiar situations.
An example to this is the empowerment of teams to handle responsibilities almost autonomously without asking advice or permission from their superiors. Since these supervisors already are empowered, they have well-established rules of thumb when it comes to handling customers and their complaints.
As for the garbage can model of decision-making, this essentially means that decisions are random and unsystematic, opposite to hat of the rational model of decision-making. This is basically making decisions randomly with the correct timing as the determining factor for success.
This kind of decision-making model is reflected in their operational decision to encourage their customers to post comments, suggestions, ideas and even complaints. This ideas are then used by Whole Foods Market to develop their services to the unique needs and wants of their different regional markets.
2) What role does participation play in the decision-making process at Whole Foods Market?
Participation plays a very important role in how Whole Foods Market plans its operational strategies. The organization has self-directed teams in each of their stores that handle operational and merchandising activities. The rationale for this is that each of these stores is given the capacity to tailor their operational decisions and activities based on their target market’s unique needs and wants.
Since the organization is decentralized, decision power is distributed to the lower portion of the organization. Each store has up to eleven teams that make decisions in their own responsibility areas. Despite this diversity of teams in the different regions that Whole Foods Market operates, all of the teams adhere to the core values and mission of the organization. So, although given autonomy, team members of the organization make decisions based on the corporate mission and vision. This prevents them from being lost on the maze of their individual market environments.
3) How does Whole Foods Market incorporate ethical considerations into its decision making?
Whole Foods market incorporates ethical considerations into its decision-making through defining its mission of “offering the highest quality, least processed, most flavorful and naturally preserved foods”. This they back-up through their policy of sourcing only the premium quality ingredients- the freshest and highest quality produce of farmers.
The company also believes in organically-grown produce. This means that they support farmers who have changed their cultural methods from conventional growing to organic farming. This type of support is ethically balanced in the sense that it develops long-term relationships between suppliers and the company. Organic farmers are supported by the company since the company pays premium prices for this produce; and, this makes the whole practice of organic farming sustainable.
Another component of ethical consideration applied by the company in its decision-making is its motto of “Whole Foods, Whole People, Whole Planet”. This essentially means that the company is committed to not just being a common food retailer, but has the commitment for success as measured by among other things, aside from the usual ROI and customer satisfaction, team member excellence, and community support. This exemplifies corporate social responsibility which is an ethical responsibility of the organization to its members and the community.