The Power of Culture in Action

The traditional Big Law business model is fading in favor of Great Law. By focusing less on profits per partner and more on cultivating a high performance culture, law firms and legal departments are achieving success beyond the financial bottom line.

In their transition to Great Law, some law firms are borrowing tactics from the business world and finding inspiration in companies outside the legal realm. One of the most teachable examples of the power of organizational culture took place just this summer, courtesy of a family-owned chain of grocery stores in New England.

Market Basket, and the employees of its 71 stores, have gone through some tumultuous times in recent weeks. Workers at all levels walked off the job and protested after the board of directors fired Arthur T. Demoulas, the company’s well-liked CEO. Control of the board of directors went to Arthur T.’s cousin, Arthur S. Demoulas, who was viewed by many employees as prioritizing shareholder profits over the company’s reputation for superior customer service and stable careers.

Organized protests attracted thousands of people and the attention of international press, while once-loyal customers participated in a devastating boycott. Shelves were bare in many stores due to absent staff and refused deliveries, though the stores were equally devoid of customers.

It was remarkable that business would grind to a halt over the ouster of a single executive, and virtually unheard of for low-ranking hourly employees to risk their jobs in order to stand up for their millionaire former boss. But those employees, with the support of Market Basket customers, were also taking a stand in defense of an organizational culture that was even more important than their paychecks.

Market Basket employees were treated as investments, not expenses. Their efforts to help the company succeed were rewarded with profit sharing perks, rare in the grocery business. They received above-average pay and benefits. According to the New Hampshire Business Review, Market Basket’s workers were especially hardworking and loyal, allowing the company to expand during periods of decline for its competitors.

Arthur T. understood the importance of cultivating this culture every single day. He was known for making daily visits to stores, where he not only knew the names of the workers, but knew their families. 41-year Market Basket veteran Tom Trainor, who was fired for walking off the job, compared Arthur T. to the character George Bailey in the film “It’s a Wonderful Life.”

“He cares more about people than he does about money,” Trainor told The Washington Post.

Arthur T.’s reputation among employees and customers is the stuff of legend, and it made all the difference in this battle for control of the company. In the face of a customer boycott and employee revolt, Arthur S. and his allied stakeholders were compelled to sell their controlling share of Market Basket to Arthur T. in late August.

Addressing a crowd gathered outside Market Basket headquarters the day after the sale, Arthur T. praised his supporters for having “demonstrated to the world that it is a person’s moral obligation and social responsibility to protect a culture that provides an honorable and dignified place in which to work.”

Organizational culture can’t just be a smattering of platitudes on the “about us” page of your law firm’s website. It must be cultivated in word and action, and with purpose, every single day. The outpouring of support for Arthur T., and the fact that it led to him regaining control of the company, may be the ultimate contemporary example of the power of culture. The next time you evaluate the culture cultivation at your firm, ask yourself how Arthur T. would’ve done it.