Arizona’s Dysfunctional Business and Governmental Culture Creates a Crisis in the Coronavirus Pandemic

On January 15, 2021, the New York Times reported that Arizona had the highest 7-day daily average per capita of deaths and new cases of the new coronavirus, covid-19.[1] On one day, Arizona had 11,324 new cases.[2] “We’re the hottest spot in the U.S. and among the hottest spots in the entire world,” said Keith Frey, the chief medical officer for Dignity Health’s Arizona division.[3] “If we don’t slow this down over the course of the next days and weeks, then we will be fully into that crisis zone,” he added.[4] It would be a crisis of the state’s own making, and thus preventable but for the local culture at least in the Phoenix metro area. In other words, the crisis did not happen to Arizona; rather, the crisis was in large part homemade, and can thus be used as a window into a dysfunctional culture in the United States.

In spite of county and municipal laws and company policies on wearing masks in stores and on public transportation (buses and the light rail), many stores and the mass-transit company forbid employees from even asking incoming customers to wear a mask (or wear one correctly over the nose and mouth). Grocery stores were particularly problematic, with even their own employees walking around with impunity without masks on (properly). “We don’t enforce that requirement,” a grocery-store director told me. How, then, can the policy be considered to be a requirement? “It just is,” a store manager told me. That wearing masks was not only a company requirement, but also a city and county law was of no interest to the manager. “We don’t enforce the law,” he quipped. “But you are violating it by letting people in who are not wearing masks,” I retorted. This was not his concern.

The Phoenix metropolitan mass-transit company, and thus its two subcontracted bus-operating companies, also had a policy forbidding employees from enforcing the company’s own requirement and the local law. Some bus drivers would even not wear a mask or wear one without covering their noses and mouths! Some light-rail security employees subcontracted by the mass-transit company wore their masks over their chins too, as did a significant proportion of the rail passengers. Some security employees asked passengers to wear their masks correctly, while most of those employees did not. The notion that masks were required on the trains was a farce, and yet notwithstanding this, the company’s representatives had no problem defying logic itself by insisting that masks were required.  It was as if the company policy and the county law mandating masks on public transportation simply did not exist, and yet they did. “It’s not really a law,” a customer-service employee told me. Why? Because the county doesn’t have a legislature and only one of them can pass laws. The county board was apparently extra-governmental in nature.

Both retail and the mass transit were exploiting an exception, that of medical exceptions, to invalidate the rule. Incredibly, the stores and mass-transit company used this exception to justify refusing even to ask customers and passengers, respectively, to cover the nose and mouth area with an existing mask. People with medical conditions exempting them from wearing masks would not have masks on. The absurdity of allowing an exception (e.g., a medical condition) to condemn a requirement was permitted in the dysfunctional culture and amid a lack of accountability by regulators.

The problem was exacerbated by the political extremism that was salient in the state. A steadfast refusal to obey the law on wearing masks had a significant role in the number of people not wearing masks in stores and on public transportation. Such people could easily exploit the managerial incompetence both in retail and mass transit. It does not take long to realize that an intentionally-unenforced requirement is not a requirement, even if this point is not grasped by company managers. Yet the managerial dysfunction enabled this condition to go on for almost a year as of January, 2021. In such a political culture wherein a significant proportion of residents believe they are justified in breaking the law and ignoring company policies, it can be reckoned as inexcusable for companies to follow the invalid logic that the existence of an exception invalidates a rule (or requirement). In other words, it is negligence pure and simple. The lack of accountability, which was well-ensconced in the culture within companies as well as between businesses and local and state government, enabled the corruption that gave the virus the upper hand. It was as if the locals could not help themselves.

Moreover, the local culture wherein political extremism was salient allowed for the erroneous belief that the public good is simply the aggregate of individual wills. Where enough wills decide not to wear masks indoors in public and on public transit, the aggregate public good falls short of being above the ability of the virus to spread. The public good as merely the aggregate of individual wills thus is not good enough; it falls short of what the public good actually is (e.g., being greater than the ability of the virus to spread). The understatement of the public good can be understood too as the belief that the general will (e.g., Rousseau) is reducible to the aggregation of private wills.

The good of the whole, I submit, is more than the sum of the individual parts because some parts may even detract from the public good and thus understate it if it is taken to be merely the aggregation of individual wills. That the market value of a product is determined by the aggregate supply and demand does not mean that the public good is likewise determined. For one thing, the market value of a product is in a closed system (the aggregate supply and demand) whereas the public good is open-ended. In other words, the public good can be higher than the aggregate of the individual wills would have it because enough private-benefit-only wills can detract appreciably from what is the good of the whole. If enough people refuse to wear masks indoors in public places, and stores and even governments look the other way, the result is significantly below the good of the whole, which in this case is stopping the coronavirus. By its self-inflicted crisis, Arizona was functioning well below its own good, and a highly dysfunctional local mentality is to blame.

---

1. Jordan Allen et al, “Coronavirus in the U.S.: Latest Map and Case Count,” The New York Times, January 15, 2021.

2. Alicia Caldwell and Ian Lovett, “Arizona Is America’s Covid-19 Hot Spot and on the Brink of Crisis,” The Wall Street Journal, January 15, 2021.

3. Ibid.

4. Ibid.

Starbucks Capitulates to Overzealous Police Union in Spite of In-Store Intimidation

On July 4, 2019 in Tempe, Arizona (Tempe borders Phoenix, which is to the west), a Starbucks' employee requested that the six police employees in the small restaurant move from the bar area where customers picked up drinks, or else leave. Because the six did not come in together, customers were provided with the special treat of a prolonged police presence throughout the store before the cops huddled near the bar. Even as the police huddled, they did so with eyes strategically perched so as to maintain visuals on the customers. One cop in particular repeated glanced over his shoulder with a darting eye towards the customers as if they were threats. That customers might be uncomfortable even with the sheer number of police in the small store was obviously lost on the police there as well as Starbucks’ employees. Yet the company was strangely without any policy on the maximum number of police who could be in a store at one time and for how long (i.e., when no incident is occurring). This is strange given the high incident of police brutality, especially in Phoenix.  Just a week later, a protest took place against the brutality in Tempe. It is natural, especially in such a context, that at least some non-criminal customer would feel uncomfortable.  Meanwhile, the police felt entitled to disrespect the customers by showing such a huge presence in the small store. Ironically, the police felt instead that it was disrespectful for a Starbucks’ employee to ask them to step away from the bar or leave after a customer complained about feeling uncomfortable with such a significant non-incident police presence. This is thus a story about institutions not taking responsibility for their own respective roles in a problem.

The police circulated in the store for some time as they did not come in together, and then huddled near where customers pick up drinks. One of the police (front left) turned his head every few minutes to glare at the customers. Who would not feel uncomfortable? 

For its part, Starbucks sought to mischaracterize the customer as “anxious, nervous or uncomfortable” when the customer actually said he or she was uncomfortable. Starbucks’ spokesman Reggie Borges also claimed that the customer “continued to ask about the officers” as if obsessed.[1] Actually, the customer approached the Starbucks employee twice, and without the “anxiety” or obsession that Borges claims the employee wanted to relieve. That the customer spoke with the employee twice suggests that the employee had not been very motivated to act on behalf of customer experience. Also reflecting a disregard for customer experience, Starbucks’ allowance of any number of police in a store at a time was part of the underlying problem, not some heavily caffeinated, hyper-strung or "problematic" customer. Deliberately mischaracterizing the customer was just Starbucks' way of denying its own deficiency in not having a policy on a maximum police presence. According the the manager of another Starbucks' store, the company should have had such a policy rather than intimating that the customer was uniquely distraught. I submit that that virtually anybody would feel uncomfortable with so many police walking around in such a small space. The customer reportedly later asked the shift manager why Starbucks did not have a policy on a maximum number of police on break in a store at one time, to which the manager reportedly retorted, “I’m going to end this conversation.” 

As for the police in the store, a certain arrogance can be said to be in people who do not act out of respect for others—such as by showing such a huge police presence in the midst of customers trying to enjoy their drinks—while perceiving a request to move or leave given the disrespect as being inherently disrespectful. Clearly, the police taking their break in the store had no concern for the customers’ comfort, given the perception that the request to move or leave was itself out of line. Perhaps the public servants in Arizona held the view that the public should take whatever the police want to do, so even a request for the police to back off would be viewed as an affront. Just as it cannot be assumed that the customer was a shaking, hyper-caffeinated anxiety case, nor can it be assumed that the customer had a criminal background, as some people on social media suggested, for even innocent customers would understandably feel uncomfortable with six police walking around with guns visible in a small room.

I contend that the local police had no recognition of having too much of a presence in the store because intimidation as a deterrent by a very visible, ubiquitous presence in the public was at the time the standard tactic, especially in the city of Phoenix. The light rail company had the same view, for it was not unusual to see four or even five security guards (with police-like badges) on just a half of a car staring at passengers. 

On a Saturday on a train, I was standing with my bike, which is lawful, so imagine my surprise when I looked up and saw three security employees wearing sunglasses standing confrontationally near me and staring at me! I put on my sunglasses and stared back. Welcome to Phoenix.

Three security guards clustered in the back half of a car. Were so many guards and such clustering really necessary?

Once a passenger sitting near me asked a guard about the huge presence without an incident, to which the guard retorted, “There can be as many of us as we want; get it?!?” His aggressive tone alone raised a red flag for me in terms of the wisdom of allowing so many security employees in a small space—not to mention giving them any authority in the first place.

A stationary Phoenix policeman on a weekday keeping a close eye on a platform as a matter of routine rather than an incident. How might waiting passengers have felt? Should this have been factored in? 

The light rail company also played a role in the excessiveness shown by the local police. Twice I saw three or four passengers on a light-rail platform surrounded by about 15 police and rail-security guards for not having had a ticket. Motorists who get a ticket for speeding were not treated to such a police presence, so I suspect the reason for the over-reaction on the train has to do with the ridership.

As another example, at a light-rail platform about a half mile from the gay-pride festival during a Saturday afternoon in a local park in April, 2019, four police cars with lights continuously flashing were parked all afternoon in the street along the light-rail platform. As I passed on a train, I saw an empty platform. When I passed by again in the early evening, I saw the four jeeps whose lights were still flashing, but this time I saw four police employees with a dog going back and forth on the platform in spite of the fact that only twenty or so people were waiting for trains. 

About a half-mile from a gay-pride fest in a city park, four policemen with a drug-sniffing dog patrol a nearly empty rail platform. 

Yet when the train picked up baseball fans in downtown Phoenix, no such show of deterrence was shown. If you can visualize four police jeeps with lights flashing next to an empty rail platform, you have grasped the distinctive over-kill mentality of Arizona. My point is that given that mentality, both the police and Starbucks employees should have realized that virtually any customer would naturally feel uncomfortable with so many police in the store. That that case took place just over a month after a notorious case of police abuse of power makes it all the more perplexing to me why the customer would be treated as a special case.

Writing about an atrocious police incident that occurred on May 27, 2019 in Phoenix, Arizona, Cedric Alexander, a former police employee, police chief, director of public safety, and deputy mayor in Rochester, New York writes that a Phoenix police employee approached a newly parked car and said, “I’m going to f---ing put a cap in your f---ing head!” Why such anger? Why such rage? The four-year-old in the car had stolen a doll from a discount store.[2] Was the enraged employee of the police department so intent to put a bullet in the girl’s head because of the nature of the crime, or else the presumed sordid little criminal? An image of a Nazi SS officer shooting a small Jewish girl may come to mind. Or did the Arizona variant determine that the mother should pay with her life because her young daughter walked out of a store with a doll and the mother had not noticed? Did the fact that a discount store had made the complaint trigger the police employee’s anger at the poor?  Admittedly, it is the poor in Phoenix who regularly ignore traffic lights and even cross-walks in crossing even very busy roads. The lack of respect for law is endemic and thus astounding there—to say nothing of the lack of consideration for other people. “The public” is a term rightly with a sordid reputation in the Phoenix valley in Arizona. So I can understand why the local police could become demoralized, even disgusted and angry, but this is not an excuse, especially as police are given the governmental power of lethal force. Human nature itself may not be up to the task, given such immense power on an interpersonal level. The Stanford Experiment in the late 1960’s, for example, demonstrated how quickly people (i.e., students) given authority over others could resort to violence even though it is expressly prohibited in the authority given. Did we not learn anything regarding human nature and police power from that experiment?

The judgment that shooting someone in the head could be appropriate rather than outrageous in the case of shoplifting by a young child (assuming the child had known what she had done!) is so warped that this itself can be taken as a red flag concerning the human mind, at least on the Phoenix police force, and having the authority to use lethal force. Cedric Alexander writes that the police employee’s conduct was “unthinkable.”[3] Perhaps the human brain or mind is altered in some fundamental sense—and not in a good way—when a dose of pure power is taken in.

The girl’s mother, along with a 1-year-old, was in the back of the car. When the police employee ordered the mother to put her hands up, she was holding the younger child and so she replied that she could not raise her hands in the air. The employee then ordered the mother’s fiancée, who was in the driver’s seat, out of the car. In spite of the fact that the man complied, the police employee pushed the guy against the car and kicked his legs apart. “When I tell you to do something, you f---king do it!” That the employee had been wrong about the driver (for he had done as commanded) brings up the troubling matter of the toxicity of power when it is mixed with cognitive issues or simply stupidity. At the time, Arizona had one of the worst systems of public (K-12) education, and faulty assumptions and incorrect conclusions were quite common even in entry-level office positions (even as managers were relying on them to deal with “the public”).

Of course, the police employee may have meant the mother, who was not able to put up her hands, but then his verdict that she was nonetheless culpable would of course be warped. The employee’s decision to take the anger out on the complying driver demonstrates bad judgment (perhaps from excessive anger), aggression, and cognitive lapses. Even when the mother shouted that her door would not open, the “understanding” employee shouted, “You’re going to f---king get shot!”[4] The assumption that putting the fear of death in the woman would somehow fix the door is interesting from the standpoints of the employee’s cognitive ability and state of mind.
Even if the employee assumed from a generally negative bias or actual experience with the poor in Phoenix (who seemed too quick to lie and even become aggressive) that the mother must be lying, the disproportionate judgment that shooting the woman would fit the lie (i.e., that the lie justified death) suggests that the employee’s mind could not handle having the power of lethal force. This would presumably be a basic matter in a police department’s hiring process as well as for police supervisors.

If the police employee was enraged because his order was not being instantly followed, both his notion of human nature in others (i.e., fallible rather than robotic) and his own psychology could be flagged. To be able to get other people to do against their will what you want is a basic definition of human power. Accordingly, the employee’s power-urge was too much for him to handle the power to kill other people. Once the mother was out of the car, the employee tried “to grab the one-year-old child” out of the mother’s arms.[5] The employee clearly had an urge for instant power, and he evinced no basic compassion. Perhaps, as in a Nazi SS officer plying Jewish kids off their parents before boarding them all on separate train cars or even trains, the human mind high on pure power chocks off any sentiment of compassion.

So far we have anger, impaired judgment, cognitive issues, aggression, and a will to power. This is a toxic cocktail to be sure, and it has no place in a human brain on a police force. Extreme care in hiring is thus important, and we can deduce that the Phoenix police department had been lax in this regard too. Adding tinder to the fire was the cultural ideological “authoritarian” assumption generally in the Phoenix valley that intimidation is an effective deterrent. A major flaw in the ideological stance is that people with good motives also get intimidated, as when the police presence is ubiquitous. This can include police helicopters as well as police cars—the former flying low even on normal routine patrols and the latter circling or standing still (i.e., patrols that cease to be mobile). The key is the frequency or amount being excessive to not only human sensitivities to being nearly constantly watched or intimidated, but also having merit in actually stopping a crime. It is no surprise, therefore, that more police were sent to the scene of the doll-heist. I would bet the number of police cars was excessive given the actual threat. To be sure, the police employee probably exaggerated it in his own mind and thus to others. Maybe the police in the Tempe Starbucks store regarded the employee’s request as a threat, given that rarely had they probably gotten push back. Similarly, bullies tend to regard anyone standing up for the bullied as a threat, and even as disrespectful!

Cedric Alexander points out in his piece that government gives police employees their legal authority to use lethal force, but police “also need legitimacy,” which according to the 2014 report by the Police Executive Research Forum “lies within the perceptions of the public.”[6] The perception of employees abusing their privilege to use lethal force does nothing to help legitimacy.

 
So I am not surprised at all in reading Cedric Alexander’s report that the police chief, Jeri Williams, said in a public forum on May 27, 2019 that real change “doesn’t start with our police department. Real change starts with our community.”[7] With the excessive show of police generally (in order to intimidate so as to deter), it was difficult to view that city as a community at all. Alexander writes of the Phoenix police department that “as professionals under oath, they have the responsibility to start the ‘real change.’”[8] Such responsibility was all the more justified because police employees were part of the problem. The police chief said in the forum that the employee’s conduct (and attitude?) on the doll shop-lifting case “unacceptable.” Cedric Alexander writes critically of this antiseptic and bureaucratic word. “Terrifying, traumatizing” are more fitting, he writes; the lift-threatening behavior of those Phoenix [public servants!] cannot be written off as ‘unacceptable.’”[9] Yet this is exactly what a department not being held accountable and certainly not holding itself accountable does. Its deterrence method of saturating the city with non-incident police presence is therefore unfortunate. More than this, it can be reckoned as a passive-aggressive instance of callousness and impaired judgment.

The incident with the little girl is a case in which police believed they had considerable discretion on how they could treat (and regard!) the public. Less extreme, the police in the Tempe Starbucks store assumed that they could bring in as many police as they wanted even if the customers could rationally be expected to be uncomfortable. Criticizing Starbucks’ reaction as disrespectful is akin to the Phoenix chief’s refusal to take responsibility; it’s the other guy’s fault. The police association even brought up the irrelevant point that some of the police in the store were veterans, and so the military was disrespected![10]  Starbucks’ request was not disrespectful toward the police, given the thoughtlessness of the police in disregarding the fact that so many police would naturally cause discomfort. Such a showing goes beyond feeling safe, especially given the police employee who felt the need to keep an eye on the customers. If he did not feel safe in the store, he should have left rather than make at least one customer feel uncomfortable. The association representing the police was so busy feeling disrespected that no thought at all went into why customers could rightly feel uncomfortable with so many police in a small store.

So in apologizing to the Tempe police department for having had the good sense to follow up on a customer feeling uncomfortable, Starbucks ignored or dismissed an entire side of the story—one in which people in the Phoenix valley understandably felt uncomfortable when the local police go too far. “When those officers entered the store and a customer raised a concern over their presence, they should have been welcomed and treated with dignity and the utmost respect by our partners (employees). Instead, they were made to feel unwelcome and disrespected, which is completely unacceptable,” according to Rossann Williams, a vice president of Starbucks.[11] So much for customer experience! By Williams' strong-handed response, the customer’s legitimate concern about the excessive police presence should have been ignored and that presence in fact greeted! I submit that the Starbucks employee had rightly judged the customer’s concern to be valid, as the police presence was rather severe for a break, and that Williams would have been fine with customers awash in police presence. In effect, Starbucks backtracked in apologizing such that the police could feel free to disrespect customers by having too much of a presence in a given store. Starbucks would no longer stick up for its customers who feel uncomfortable with the over-kill of police who do not respect customers enough to limit the police presence. Instead, Starbucks would continue to greet as many police employees as want to inundate a given store. In effect, Starbucks would enable the “intimidation as deterrent” authoritarian tactic that is so ingrained in the Phoenix-area culture. It is, “a police state,” as several new arrivals have observed. In such a state, customers wanting a break from it while enjoying a drink at Starbucks could hardly be blamed, but sadly this did not stop Starbucks from tacitly doing so. Meanwhile, like the Phoenix police chief who had viewed the public as needing to take the initiative even after the police abuse of the four-year-old shoplifter, the Tempe police chief could only see his employees being disrespected. This tells me that neither department was used to being held accountable. The prerogative to being able to get away with disrespectful conduct easily views any push-back as disrespectful. It’s always the other guy. Starbucks, meanwhile, should have stood up for its customers because six cops in a small store are simple too many for customers to feel comfortable. The uniform and the lethal right to use force render police qualitatively different than customers, hence Starbucks’ refusal even after the fact to come up with a policy protecting the experience of customers is also telling.

Recommended: Bucking Starbucks' Star, available at Amazon. 

---

1, Sandra Garcia, “Starbucks Apologizes After 6 Police Officers Say They Were Asked to Leave,” The New York Times, July 8, 2019.

2. Cedric L Alexander, “The Police Overreaction to Case of 4-year-old and Barbie Doll Isn’t Just ‘Unacceptable’—It’s Outrageous,” CNN.com (accessed June 20, 2019).

3. Ibid.                

4. Ibid.

5. Ibid.

6. Ibid.

7. Ibid.

8. Ibid.

9. Ibid.

10. Amir Vera, “Starbucks Apologizes after Six Officers Say They Were Asked to Leave a Store in Arizona,” cnn.com July 6, 2019.

11. Amir Vera, “Starbucks Apologizes after Six Officers Say They Were Asked to Leave a Store in Arizona,” cnn.com July 6, 2019.

It’s Only Fair

Astonishingly, organizations can violate their own mission statement without any manager or non-supervisory employee being aware of the violation. This can happen even when the people in an organization really do take their mission seriously. At Goodwill, the mission is to end poverty, a laudable goal. It follows explicitly (i.e., according to a sign in the stores) that “every customer has an equal opportunity to purchase any item for sale.” Although the sign bases this point on the fact that the goods “come from public donation,” I submit that ending poverty by giving the poor access to relatively low-priced merchandise is hampered if some customers are permitted to fill their carts with on-sale (i.e., color of week) items when the doors open. Certainly allowing those resale-minded customers to deprive other customers of a selection of items on sale (especially clothing, which even homeless people need) is not fair.

According to the sign, possible violations include any employee or volunteer of a store being able to purchase items in the store whether for themselves or others. “Nor may merchandise be reserved or set aside for anyone.” To be sure, recognition is also given to the possibility that a customer might think that the organization is not being fair. When I interviewed a store manager about whether allowing customers who resell items on sale in “garage sales” conveniently misconstrued as businesses to buy in such bulk that effectively deprives other customers, whose use for the clothing is for personal use, she dodged the question itself but took my point implicitly by admitted that she knew of no way in which the practice could be thwarted. I told her I had a few ideas, but she was not interested in them. I topld her I am a business ethicist and would be writing on this case. Patronizingly, she quipped, “Have fun writing your paper!” In retrospect, I wish I had replied, “Have fun managing!” How interested would the organization’s management be? I wondered at the time.

Goodwill could indeed have stepped in to prevent the obviously unfair practice of certain customers, who actually compete with each other in going around—as part of their re-selling businesses—to different Goodwill stores to swoop up as many shirts or pants on sale. 

A "garage sale" of a reseller open for business at her personal residence. Beyond the cars is the Goodwill store at which I had observed the opening of a major, half-off, sale on shoes and clothing (and misc) just a week earlier. Some of the athletic shoes, which sold for $7 without any negotiation (a sign that a reseller is hosting the "garage sale"), I had seen in a cart full of such shoes at the beginning of the sale at the Goodwill store. 

The personal-use customers can have little chance, or practical opportunity, to get an item on sale because Goodwill allows customers even at the opening of a sale to fill their carts entire of one kind of item (e.g., athletic shoes). Even if a wife/mother is buying athletic shoes for her husband and teenage kids, a whole cartful is suspicious. I witnessed a woman head immediately to the shoe section when the doors open and quickly throw as many athletic shoes in her card as she could before other customers had a chance to take advantage of the sale. Clearly, the monopolistic character of the woman’s behavior and that her commercial interests could eclipse the personal-use interest of other customers who would do without as a result not only reek of unfairness, but also violate the “equal opportunity to purchase any item in the store.”

A reseller had her cart full just seven minutes after the Goodwill store opened with a sale that would practically guarantee that the reselling would be lucrative. The number of men's shorts alone in this cart points to something beyond personal use. The resellers do not pay taxes on their profits because the sales, primped as "garage sales," are easy not to report. Legally, the income from genuine garage sales is taxable.

Meanwhile, Goodwill looks the other way undoubtedly because more revenue and less risk of having items unable to be sold are obtained when the re-sellers buy in bulk. In other words, the lack of recognition of the tilted status quo and of ideas on how to restore balance may not be accidents. A false premise that the status quo must be balanced, or that the status quo does not justify effort to achieve balance may also be in the mix. A policy could be put into effect that limits the number of same-classification items on sale that can be purchased by each customer.

Already I can think of ways in which the commercial customers could get around this limitation, for profit-seekers hate limits, whether internal or external. They could bring along family and friends to divide up the quickly stashed merchandise. They could fill their respective carts when the doors open and carefully stash their carts so to be able to make multiple trips to different cashiers.

At some point, however, store employees and even managers can be relied on to help enforce the policy by being on the lookout for such tricks. A customer’s claim that she needs a cartful of sneakers in order to try them on to find one that fits can be easily rebuffed. Only six items are allowed in the fitting rooms anyway. Such games and how to deconstruct them could be incorporated into training. It is not difficult, for example, to see people quickly filling their respective carts with one or two item-classifications shortly after the doors open. The store manager with whom I spoke had no problem in identifying the re-sellers who buy in bulk. Her hands’ off, laissez faire attitude was problematic as it did not fit with the organization’s mission to reduce poverty in a fair way, which in turn requires equal access to the merchandise. Hiding behind the relatively effortless status quo, as if it were intractable or even as fair as possible, evinces a willingness to live with an unfairness that could otherwise be reduced even if it cannot be eliminated. Not having any ideas when imperfect measures could make a dent evinces an unwillingness to think too far from the status quo (i.e., outside the box).

See "A Lack of Good Will at Goodwill."

See also Cases of Unethical Business: A Malignant Mentality of Mendacity, available at Amazon. 

Hierarchy Hampered Down in American Business

Without going into either the labor or management camp, a person can viably critique the operation of hierarchy itself in business organizations. The notion is typically associated with the concentration of power at “the top,” rather than the relation of middle-level managers to “retail” managers and their subordinates. Efficiency of power at a corporate headquarters does not necessarily translate into “downward” efficiency at the level of middle management. I submit that precisely this efficiency is rather severely compromised in American business.

“The word hierarchy derives from ancient Gree (hierarchia, literally the ‘rule of a high priest’) and was first used to describe the heavenly orders of angels and, more generally, to characterize a stratified order of spiritual or temporal governance.”[1] The early focus on the situs of a high priest rather than all priests, and the heavenly orders rather than the relation between them and the earthly orders set the tone: the top matters most in a hierarchy. I am guilty in that my theory of organizational leadership applies exclusively at the top: the leadership of an organization. Supervisory management is in my view another animal. Yet it too is important, and I contend that it is woefully neglected in American business.

Customers, for example, of retail businesses will recognize the frustration in dealing with not only  a rude or stubborn employee—even acting at odds with a company policy!—but also that employee’s gatekeeping, or outright refusal to get a supervisor as requested. The sense of entitlement that a non-supervisory employee may have rivals the sense of importance of a CEO. Getting to a store manager can nonetheless require a lot of effort and patience; typically an assistant manager is sent to put out the little brush fires. Employees may know how to exploit this gap that exists between what the employees and a store manager are doing, such as by insisting that aggrieved customers first inform the indolent employee of what will be said to the manager (a conflict of interest to be sure!).

In short, retail-level managers tend not to be involved enough where customer-meets-employees; management by walking around is too easily sidelined by the endless list of things needing to be done behind a desk. Put another way, I contend that retail management is generally interpreted as being akin to upper management, rather than something unique. The situs one or even two levels above non-supervisory employees on the front line should be actively involved on that line, and the complaint access can be greatly improved such that customers do not have to depend on problematic employees for it and spend much time and effort in reaching accountability. Hierarchy is made for efficient accountability, whereas networks (e.g., organic organizational structures and flat inter-organizational relationships) may be overrated.[2] Yet the “lower” half of a company’s hierarchy is, I submit, underutilized and perhaps even unwittingly compromised in part due to the common association of hierarchy with “the top.”

Starbucks, for example, has a centralized customer service number, which can be used to register a complaint against a store employee. The offended customer may get a gift card for a few free drinks to compensate—and such compensation, rather than an apology alone, is important—but what about the distance from the centralized unit at headquarters and the store-level employee? The unit sends a communication to a regional or district manager, who in turn is supposed to communicate with the store manager, who in turn is supposed to have a talk with the employee. Considering the sheer number of links, and the distance involved, the intended message could be compromised both intentionally and unintentionally. A district manager, for instance, may just do enough to make it seem that a real correction has been made. A store manager might dismiss the charge, as it reflects badly on the store’s management. Rarely, perhaps, would a store manager tell a shift manager to listen to what the employee is saying to customers. I also doubt whether the typical complaint results in any actual and substantive negative consequences for the employee, especially if attitude is the culprit (which is not likely re-trainable).

For all that Howard Schultz’s CEOship of Starbucks has been lauded, I have been surprised at the number of times I have witnessed rude, close-minded behavior of employees at the store level. This is not to say that good employees have not worked in the stores. My point is rather that in the company’s hierarchy, the part between the district managers and the store employees seems weakest. In my booklet Bucking Starbucks’ Star, I argue that Schultz’s corporate social responsibility ventures “at the top” do not make up for managerial and employee deficiencies further “below.” I have never seen a store or even a shift manager “working the room” in stores to see how the customers were actually served, and such managers can confront centralized reports of complaints by rationalizing, the customer got free drinks, so there’s no need for me to take action against the employee. Management as walking around, even by district managers scheduling time to work along side the crews at the various stores, and in having direct access to complaining customers, could make a dent in shoring up hierarchy in business organizations where patching is most needed. Hierarchy can be a good thing, provided it is thought through in its various, distinct levels.

See: Cases of Unethical Business, Walmart: Bad Management as Unethical, and Bucking Starbucks' Star.

---

[1] Niall Ferguson, “In Praise of Hierarchy,” The Wall Street Journal, January 5-6, 2018.

[2] Ibid.

Institutional Conflicts of Interest: Business and Public Policy

Typically people react emotionally much more severely to an exploited conflict of interest when a person gains a personal benefit such as through a bribe. If company, or even an office or department thereof, stands to benefit inordinately, American society typically looks the other way on the institutional conflict of interest rather than taking it apart. This may just be human nature. However, the troubling institutional arrangements within an organization or between them may be tolerated because of the erroneous assumption that conflicts of interest are unethical only when they are exploited. Accordingly, the book provides a solid grasp of the structure and essence of the conflict of interest in order to make the case that it is inherently unethical. Examples of institutional conflicts of interest readily come from business, with particular attention to corporate governance and the financial sector, as well as from how business and government relate, such as through regulation The reader should come away with a sense of just how pervasive and ethically problematic institutional conflict of interests are. 

The book, Institutional Conflicts of Interest: Business and Public Policy, is available in print and as an ebook at Amazon.com