Whole Foods has a new inventory-management system aimed at making stores more efficient and cutting down on food waste. And employees say the retailer’s method of ensuring compliance is crushing morale.
The new system, called order-to-shelf, or OTS, has a strict set of procedures for purchasing, displaying, and storing products on store shelves and in back rooms. To make sure stores comply, Whole Foods relies on “scorecards” that evaluate everything from the accuracy of signage to the proper recording of theft, or “shrink.”
Some employees, who walk through stores with managers to ensure compliance, describe the system as onerous and stress-inducing. Conversations with 27 current and recently departed Whole Foods workers, including cashiers and corporate employees — some of whom have been with the company for nearly two decades — say the system is seen by many as punitive.
They say many employees are terrified of losing their jobs under the new system and that they spend more hours mired in OTS-related paperwork than helping customers. Some are so fed up with the new system that they have quit or are looking for other jobs. In addition to hurting morale, OTS has led to food shortages across Whole Foods stores, they say.
On calls with investors, Whole Foods executives have said that OTS has helped cut costs, reduce shrink, clear out storage, and enable employees to spend more time engaging with customers. And employees, as well as outsiders, have said that the company’s decentralized system was inefficient and needed a change.
But the new system goes too far, according to the employees who spoke with Business Insider.
“The OTS program is leading to sackings up and down the chain in our region,” said an employee of a Georgia Whole Foods. “We’ve lost team leaders, store team leaders, executive coordinators and even a regional vice president. Many of them have left because they consider OTS to be absurd. As an example, store team leaders are required to complete a 108-point checklist for OTS.”
All the employees spoke on condition of anonymity for fear of retribution. Whole Foods did not respond to requests for comment on this story.
Whole Foods enforces compliance with OTS by instructing managers to regularly walk through store aisles and storage rooms with checklists called “scorecards” to make sure every item is in its right place, according to nearly 80 pages of internal company documents reviewed by Business Insider.