The understanding of consumers being the core

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Successful company in nowadays market understands the consumer is the first and the core to their business, because they subscribe to the theory that if the customer is happy, then the business will be more profitable (Milton Friedman, 1886 and Rodgers, 2005). Whole Foods Market is one of the company which committed to the "customer first" model, which probably has one of the best corporate image in the United States by helping to promote issues like health, animal welfare, and community to their end customers. Whole Foods Market started with one small store in Austin, Texas 30 years ago, but now with over 270 stores in North America and the UK, it has become the world's leading natural and organic food company. After the company was founded in 1980 with a single store, it grew dramatically into a chain of more than 130 stores in 25 states, the District of Columbia, and Canada. It is a Fortune 1000 company, ranked as the 41st largest U.S. supermarket and the 730th largest U.S. company overall (wholefoods, 2010).

The company has worked hard to maintain ecologically sustainable and socially responsible practices. "Whole Foods, Whole People, Whole Planet" (Whole Foods Motto) captures the company's mission to obtain success in customer satisfaction and wellness, employee excellence and happiness, enhanced shareholder value, community support and environmental improvement. The philosophy of the company is to operate on a daily basis. The reputation of the Whole Food Market are to selling the highest quality of natural and organic products; stratifying and delighting their customers; supporting team member happiness and excellence; creating wealth through profit and growth; caring about the communities and the environment; creating on-going win-win partnerships with their suppliers; and promoting the health of their stakeholders through healthy eating education. Hence, sustainability is a key focus of Whole Foods Market, which means the children and grandchildren will be living in a world that values human creativity, diversity, and individual choice.

As a result, Whole Foods Market established the Whole Planet Foundation, a non-profitable organization on February 18, 2005 to fight for poverty in developing country. Whole Planet Foundation is a part of Whole Food Market's expansion to actively participate in communities, providing grants to institutions in countries around the world that in turn develop and offer programs to help leverage financial sustainability (whole planet foundation, 2010). The Whole Planet Foundation was formed in partnership with Professor Muhammad Yunus, a pioneer of microcredit, and Bangladesh's Grameen Bank; co-recipients of the 2006 Nobel Peace Prize for their work (whole foods, 2010)

The primary focus of the Whole Planet Foundation is to improve the economic well-being of the poor in developing countries by assisting entrepreneurship and self-employment through income-generating micro- enterprises via access to capital through micro-loans. The Whole Planet Foundation's mission is to create economic partnerships with the poor in the developing-world communities that supply Whole Foods Market's stores with product. This foundation seeks to capture the entrepreneurial spirit, energy, and creativity of human beings. Through innovative assistance for entrepreneurship which has including direct micro-credit loans and tangible support for other community partnership projects. Micro-loans are about empowering people to take responsibility for their own lives, to create small businesses and become successful entrepreneurs so that they can lift themselves out of poverty through their own efforts (whole foods, 2010).

Part A: bottom line

Utilitarianism (teleology ethics) has been the most influential normative ethical theory taking the teleological approach in modern days. According to Jeremy Bentham and John Stuart Mill, Utilitarianism advocated the principle and goal of the ethical good as that which produces "the greatest happiness for the greatest number" of people. According to this account an act is ethically acceptable if its consequences are good for the greatest number of individuals, and bad if they are not. Though admirable, its approach to achieving happiness was rather like a stimulus or response approach, focusing on the influence of pleasure and pain and the negative and positive associations created through praise and punishment.

The foundation has produced "the greatest happiness for the greatest number" of people. The foundation is dedicated to fighting poverty in developing countries where Whole Foods Market trades by funding micro loans to benefit poor women begin their own business in which Whole Foods buys some of its products. For instance, in Kenya, a coffee grower used a series of microloans to expand her farm, and in Haiti, a woman used the money to restore her grocery business that was wiped out by a hurricane (Whole Foods.com). The term "micro" is applied because typical transactions are less than $200. When you live on less than $2 per day, as nearly half of the world's population does, a loan of $100 or $200 can have a life-altering impact. A small sum enables a seamstress to purchase a sewing machine, allowing the women to serve more customers than she could by doing her work by hand. Another borrower might buy a goat to begin a milk and cheese production business. The smallest of loans allow the poorest of people an opportunity to lift themselves out of poverty through their own self-initiative, creativity and power (Whole Story,2010) Many microfinance practitioners view women as key "economic agents of change, in part because of their frequent isolation from the mainstream economy, but also because of their control over their children's health, well-being and education, which impacts future generations. Micro-loans are about empowering people to take responsibility for their own lives.

Micro-loans are based on the principle that the poor have skills that remain under-utilized for lack of available credit. Instead of handing out money as charity, the micro-loan system teaches the value of money by enabling borrowers to make money through their own entrepreneurial efforts. In addition, the money that is repaid can then be loaned out again to others, creating a self-sustaining cycle that will eventually lift the community out of poverty. The foundation project supports microenterprise through small, collateral-free loans allowing women to capitalize on their skills. This creates the potential to reduce costs while generate greater profits to support familial expenses and invest in their children's education. Whole Planet Foundation benefit these women to empower themselves by creating their own prosperity facilitated by the access to capital. Moreover, community relations at the local and international level are supported in several ways. Whole Foods Market periodically holds Community Giving Days where the local stores donate 5% of total net sales will go directly to entrepreneurial opportunities for the poor through the Whole Planet Foundation (Whole story, 2010). The company has also donated food to food banks and promotes environmental stewardship by utilizing local composting facilities. From small beginnings, the world can be impacted.

Deontology has great value for analyzing ethical CSR and altruistic CSR, since its focus is on responsibility, and therefore it will be this paper's major focus (Geoffrey P.Lantos, 2002) Deontology is the branch of moral philosophy that concentrates on duties or moral obligations - it puts the responsibility in corporate social responsibility. If an action does fulfil one duty the action is ethical. John Mackey who is CEO of the Whole Food Market has made profit for their companies while also promoting virtue. He is typically seen as the classical expression of consequential ethical thinking. As entrepreneurs, John Mackey recognized the value of running their companies ethically at a time when most people saw the marketplace as an environment in which quick, short-term profits could be made. John Mackey saw the importance of linking ethics to entrepreneurship, knowing full well the pitfalls and potential criticism awaiting them for linking ethics and profits together.

Corporate Social Responsibility (CSR) has become prominent in the language and strategy of many businesses as a means of strengthening their relationships with customers and suppliers and building a strong brand. According to Peloza and John (2006), reveals a positive CSR acts as insurance by protecting reputation and reducing the financial impact of negative publicity. Through the Whole Planet Foundation, Whole Foods Market has demonstrated its belief in corporate social responsibility. The Whole Planet Foundation project is very positive and great aid for many people with economic difficulties. Through this program many opportunities are being offered. Through the vision of share fate, it helps to create the company reputation and brand image to Whole Foods market. Furthermore, the way in which a business goes about demonstrating to customers the value of their product or service is important. By doing good to build a better society also increase firm's interface with communities in which they operate to create images that will cement their brands in customers' minds. Businesses can convey information to customers and potential customers in either an ethical manner that may establish such deep loyalty to organization.

Diagram 1: Title

Source:

Please enlarge the diagram as the prices can't be seen clearly.

However, the Whole Foods Market prices are more expensive than its competitors (as shown in Diagram 1), but through their demonstrating responsible management practices to the society, which also can be imitated by competitors to develop long term relationship create socially complex, time-dependent resources based on reputation and trust. Reputation and trust can enhance the value of these relationships, which is not so easily imitated by competitors (Fombrun and Shanley, 1990; Barney and Hansen, 1994). Hence, customer loyalty, reputation and trust has become their competitive advantage in turn translates into better sales and increase profits. According to 5 years trends analysis in the annual report has shown positive sales and financial performance.

Table 1: Whole Foods Market Sales (2005 - 2009)

2005

2006

2007

2008

2009

Sales

$ 4,701,289

$5,607,376

$6,591,773

$7,953,912

$8,031,620

(Source: Whole Foods Market annual report available at …)

The total sales in year 2005 compare to 2009 increase tremendously which is $ 4,701,289 to $8,031,620, which is about 70.83%.

Table 2: Whole Foods Market Gross Profit (2005 - 2009)

2005

2006

2007

2008

2009

Gross Profit

$1,649,105

$1,959,642

$2,296,603

$2,706,705

$2,754,310

(Source: Whole Foods Market annual report)

Based on the annual report, the profit figure has shown linear increasing. From 2005 to 2009, the profit rose by 67%.

Table 3: The Comparison between Sales, Profit and Store Count (2005 - 2009)

Sales

Profit

Store Count

2005

$ 4,701,289

$1,649,105

175

2006

$5,607,376

$1,959,642

186

2007

$6,591,773

$2,296,603

276

2008

$7,953,912

$2,706,705

275

2009

$8,031,620

$2,754,310

284

(Source: Whole Foods Market annual report available at …)

The Whole Foods Market has expending their store from 176 stores (2005) to 284 stores (2009). Every year, the store count has increased following the sales and profit growth.

2005 is the year which is Whole Planet Foundation was started. The potential Whole Planet Foundation offers as a driver to expanding and prospering are clearly highlighted in Tables 1, 2 and 3. Due to the increasing the sales and the bottom line profit, which result in the whole foods market stores has been expending.

Part B: to get the best out of employee

According to a study conducted by XueYing (2010), asignificant social welfare project can help firm retain excellent employees and improve morale.Volunteerism would help to develop employees' characteristics such as creativity, trust, teamwork, and persistence. It builds skills and attitudes that foster commitment, company loyalty and job satisfaction. Morale is as much as three times higher in companies with volunteer programs. Shari Caudron, 1994, has found a positive association between employee involved in corporate volunteer programs and better physical health, mental health, and social interaction.

Ccommitment can be defined as the feeling of responsibility for the company's common goals independent of any direct revenue that the worker obtains. (Akerlof, 1982)Good relational contracts with and between its workers and commitment to the company's goal stimulate a cooperative ethical attitude. Everybody will share in the additional common revenues of the company made possible by the commitment of all workers (Hosmer, 1996).

The goals of the program are formally recognize the value of business skills gained through community service, transfer practical skills from community to work business application. It provides managers and employees with alternative ways to develop their business skills. It also provides a low risk learning experience for both the employees and the corporation and contributes to the betterment of the organization and community. A company with a strong community involvement program is likely to score high in profitability and employee morale.

This program gives employees the chance to learn and apply experiences gained through community service to their personal and professional growth. Besides, the volunteer program help employee to identify the skills they want to develop and then work with them to identify ways and venues in which to practice those skills.

Whole Foods Market employees who are involved in Whole Planet Foundation 15 day's volunteer programs in Guatemala, Costa Rica and India have the unique opportunity of being immersed in one of several stunning cultures and countries. The volunteer program able to enhance their virtue ethic.Virtues is attitudes, dispositions, or character traits that enable them to be and to act in ways that develop this potential. They will try to pursue the ideals which have adopted. Honesty, courage, compassion, generosity, fidelity, integrity, fairness, self-control, and prudence are all examples of virtues. These are some of the virtues highlighted by Aristotle in his Virtue Ethics that proposes seeing virtue as part of this world, and constitutive of a human life well-lived and also emphasising the importance of a good upbringing (reference).

Moreover, the program helps to reiterate the company's commitment to its core value of "supporting team member happiness and excellence". Whole Foods Market's Health organized two internal incentive programs for their team members which are the team member healthy discount incentive and the total health Immersion Program. It offers 20 percent discount on purchases at Whole Foods Market stores as an employment benefit and those who voluntarily opt to participate in the incentive plan could receive up to an additional 10 percent discount.

Besides, the total health immersion program have offers the team members intensive wellness education programs geared toward sustaining long-term, positive lifestyle changes which including healthy eating, fitness and empowerment. Participating in the immersion program will allow Team Members, who qualify and who are ready to take charge of their own health, to receive more direct support in making positive lifestyle and dietary changes under the guidance of a medical professional, and at no cost to the company.

Table 4: The Numbers of Team Members (2005 - 2009)

2005

2006

2007

2008

2009

Team Member

38000

41500

52600

52900

52500

(Source: Whole Foods Market annual report available at …)

From 2005 to 2009, the number of team member has obviously increased by 38.2% to 52500 team members. Whole Foods Market employs more than 53,000 Team Members and has been ranked for 11 consecutive years as one of the "100 Best Companies to Work For" in America by FORTUNE magazine. (Whole Foods, 2010)

The foundation has produced "the greatest happiness for the greatest number" of people over the country. Whole Planet Foundation enable helps to increase Whole Foods Market's market share. Well, at the same time, it also benefit the poor women and their family in the village, create job opportunity and enable their child get a better education, health care and so on. In conclude, Whole Planet Foundation has created a win-win situation which should be continuing to benefit their stakeholders and the society. However Whole Foods will probably have a difficult time over the next few years. Revenue growth can be provoked through a marketing campaign and community outreach, such as advertising "get more, live healthy" by media placement. Besides that, the company may also repackage goods to be sold as labelling "cook at home restaurant boxes" or expand their service offering included store events and online ordering. Net income may not grow, but the company at least able enjoy profitable.

Reference:

Milton Friedman, The Social Responsibility of Business is to Increase Its Profits The New York Times Magazine, September 13, 1970

Friedman, M. (1962), Capitalism and Freedom, University of ChicagoPress, Chicago, IL.

T.J. Rodgers. Rethinking the Social Responsibility of Business

http://blog.wholefoodsmarket.com/2009/10/prosperity-campaign-changing-the-world-together/

http://www.redorbit.com/news/technology/275919/whole_foods_marketr_establishes_whole_planet_foundation_to_fight_poverty/index.html

http://www.sustainablebusiness.com/index.cfm/go/news.display/id/7531

motto

http://www.prnewswire.com/news-releases/whole-planet-foundationtm-a-whole-foods-market-foundation-and-nobel-peace-prize-winner-dr-muhammad-yunus-partner-with-natural-foods-vendors-pledging-over-1-million-to-help-combat-poverty-56820222.html

http://wlion.com/does-web-site-design/whole-planet-foundation

http://www6.miami.edu/ethics/pdf_files/csr_guide.pdf

http://www.fundinguniverse.com/company-histories/Whole-Foods-Market-Inc-Company-History.html

http://wlion.com/does-web-site-design/whole-planet-foundation

Carroll, A.B. (1999), "Corporate social responsibility: evolution of a definitional construct", Business and Society, Vol. 38 No. 3, pp. 268-95.

Pearce, J.A. II and Doh, J.P. (2005), "The high impact of collaborative social initiatives", MIT Sloan Management Review, Vol. 46 No. 3, pp. 30-9.

Fombrun, C. and Shanley, M. (1990), "What's in a name? Reputation building and corporate

strategy", Academy of Management Journal, Vol. 33 No. 2, pp. 233-58.

Barney, J.B. and Hansen, M. (1994), "Trustworthiness as a source of competitive advantage",

Strategic Management Journal, Vol. 15, Special issue, pp. 175-90.

Peloza, John. (2006). Using Corporate Social Responsibility as Insurance for Financial Performance. California Management Review, 48(2): 52-72.

Geoffrey P.Lantos. (2002) the ethically of altruistic corporate social responsibility, Consumer Marketing Journal, Vol.19 No.3

http://www.slideshare.net/allenallaman/wholestratfinalweb

http://www.csrwire.com/press_releases/24114-Whole-Planet-Foundation-TM-a-Whole-Foods-Market-Foundation-and-Nobel-Peace-Prize-Winner-Dr-Muhammad-Yunus-Partner-With-Natural-Foods-Vendors-Pledging-Over-1-Million-to-Help-Combat-Poverty-

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