When a Servant Leader is Fired – Market Basket Demonstrates the Cost of Terminating a Servant Leader CEO

Market Basket Stakeholders Rally to Support Their Servant Leader

Market Basket Stakeholders Rally to Support Their Servant Leader

There’s a Hollywood plot playing out in Massachusetts, as cousins battle for control over a large grocery store chain. Unfortunately, employees, suppliers and customers are paying the price.

Market Basket is a multi-billion dollar, family owned, grocery chain in New England. Or at least, it was worth billions. Thanks to a family feud, it’s value is about to implode. According to news reports, one side of the family (lead by Arthur S. Demoulas), recently gained majority control of the board. With control in his power, Arthur S. terminated long-time CEO and apparent servant leader, Arthur T. Demoulas.

What is a Servant Leader?

Based on the support of the multiple stakeholder groups and the unheard of scenario where employees walk out on their jobs to demand their CEO be rehired, it seems Arthur T. is a servant leader. A servant leader is Selfless, Empathetic, Resolute, Virtuous, Authentic, Nascent and Thorough (SERVANT). The support of his organization speaks to most of these attributes. However, some specific examples are mentioned in employee interviews about the matter, such as his implementation of profit sharing, his engagement with front-line employees, regular appearances at stores and visits with customers. As for business results, these same employees site the company’s continued growth and expansion during what has been tough years for their competitors. In one of his few comments since being fired, Arthur T. displayed servant leadership principles by asking that employees fired over their support of him, be reinstated:

“The success of Market Basket is the result of two things: a business model that works and the execution of it by a dedicated and impassioned team of associates. Their fierce loyalty to the company and its customers has always been deeply valued. In the final analysis, this is not about me. It is about the people who have proven their dedication over many years and should not have lost their jobs because of it. I urge that they be reinstated in the best interest of the company and our customers.”

History of the Feud

The family feud, in short, stems from Arthur T.’s father gaining control of the company when Arthur S.’s father passed away. It seems the Arthur S. family felt taken advantage of. A legal battle ensued and there’s been tension ever since. According to some accounts, the decision to fire CEO Arthur T. was based more on vengeance than business or concern for stakeholders.

Reaction by Stakeholders

In dismay over the firing of their servant leader CEO, thousands of employees came out to demonstrations and demanded the board rehire Arthur T. Demoulas. Several store managers threatened to quit their jobs unless the CEO was rehired. Many customers also showed up at the demonstrations and / or boycotted stores.

With the absence of employees, shelves go unstocked, food is not getting delivered, customers are going unserved and some estimates of daily losses are up to $10 Million. Furthermore, many customers are shopping at competitors and may not return. Arthur T. extended a buy out offer for the company, but the Board and Arthur S. exceeded the first deadline. At the time of this writing, it seems the board was still entertaining offers.

Digital Media’s Role

The official Market Basket website, according to Wikipedia (http://www.demoulasmarketbasket.com/) is down. In contrast, a website that seems in support of Arthur T. and Market Basket employees, is up (http://wearemarketbasket.com/). Likewise, social media has an effect with two songs (Dear Market Basket & Market Basket Protest Anthem) a Pinterest Board,  Twitter activity reaching an estimated 350,00 impressions, a Facebook page with 75,000+ likes and more.

Whatever side you’re on in this debate, one thing is clear: Market Basket stakeholders prefer long-time CEO, Arthur T. The business value was strong under him and is quickly being squandered away. One side practices servant leadership and the other, well, does not seem to do so.

Question: What do you think, does this represent an example of what happens when a servant leader is fired?

2017-05-25T01:36:45+00:00 Servant Leadership|0 Comments

About the Author:

Ben Lichtenwalner is the founder ModernServantLeader.com - the leading blog on servant leadership and top 35 site for any leadership topic, globally. Ben also speaks and consults on IT and management topics for a large variety of clients. Find out more about him at https://ModernServantLeader.com.

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