My new column is online and in the edition of Time with the flag pin on the cover. It begins:
Long, long ago–in what they are pretty sure was the 1974-75 school year–John Mackey and Kip Tindell shared a house with three other students near the University of Texas campus in Austin. They played a lot of poker–Tindell always won–but never became particularly close. After that year, they drifted out of touch.
Their lives, though, continued along parallel paths. Both men dropped out after long undergraduate careers (“I crammed a four-year program into about eight years,” Tindell jokes). Then, in 1978, both started businesses: Mackey, with his then girlfriend, opened a health-food store in Austin; Tindell, with a guy he had worked with at Montgomery Ward, opened a store in Dallas that sold containers.
From these beginnings have emerged two great retailing successes: Mackey’s Whole Foods Market is the leading natural-foods supermarket chain; Tindell’s Container Store has the storage-and-organization category it invented pretty much to itself. And lately, ceos Mackey and Tindell have reconnected–partly to bask in the shared joys of being rich former slackers (“You have a Frisbee golf course on your ranch too?!?”) but mainly to discuss the approach they say has enabled their success. I got to sit in on such a chat at Whole Foods’ headquarters in Austin. (A transcript is at time.com/mackeytindell.)
“Simultaneously we hit upon the philosophy that I think will be the dominant philosophy in business in the 21st century,” Mackey says. “It’s this principle that the purpose of business is not primarily to maximize shareholder value.” Read more.
If you’re wondering how I came to write about this particular topic this particular week, here’s the story: I met Kip Tindell last year, and he suggested a joint interview with him and his old housemate John Mackey. So I went down to Austin in March to do the interview. Then I had to get my book done. Then I spent weeks trying to distill the transcript of the conversation down to two or three magazine pages, a task of which I eventually despaired. So I decided to write a column about it, then run an edited but pretty long transcript online. But the column kept getting bumped by more timely topics. It was going to be bumped again this week, so I could write about offshore oil drilling. Then it was realized that both Klein and Kinsley were writing about energy, so I was free to focus on rich Texans with weird ideas about business.
Do I buy the Mackey-Tindell argument that they’ve stumbled upon some brilliant new form of capitalism? Partly, sure: Gung-ho, well-informed, empowered employees can certainly help you sell more stuff. And treating suppliers as partners seems to be a more sustainable approach than trying to beat them down. But I just think things get an awful lot harder when growth slows. Conflicts–between employees, shareholders, customers, suppliers, etc.–become a lot more apparent. And sometimes you just have to choose sides.