It’s true in every industry sector and in every geographical location. At a time of fast changing markets and heightened competition, there is  growing recognition of the need to re-think business models. The very hierarchy of business structure is increasingly under question in the ongoing debate on executive pay. Whether it is via a focus on corporate culture, the changing ethos of work , or the need for better communication, it  comes down to a greater need for empathy in business.
It is particularly interesting to watch in the U.K. retail sector, where markets have perhaps been closely aligned by affluence as well as aspiration on the part of consumers – a factor that seems to have changed rapidly in the years since the financial crisis. My home town in Kent is a good example: very affluent and heavily dominated by the financial services industry, it has always offered the ‘upper end’ of the food retailers – Sainsbury’s, Tesco, Waitrose and Marks & Spencer.
Of these, Waitrose and Marks & Spencer dominate the town center. There is also a smaller Tesco in the center but after 2008 one regularly found the well-heeled shopping in the large Tesco superstore on the outskirts, armed with their Waitrose bags and not keen to make eye contact. Until recently, when Lidl, the German discount supermarket chain, opened its doors a stone’s throw from the busy commuter train station.
The logo of the Lidl supermarket in Chambourcy, west of Paris, Tuesday, Dec. 3, 2013. Lidl is a German global discount supermarket chain, based in Neckarsulm, Germany, that operates over 10,000 stores across Europe. AP Photo/Remy de la Mauviniere
Those who follow me on Twitter will have suffered a string of tweets as I ‘discovered’ Lidl. From the start it was obvious this was also a business that was  good with social media, using #LidlSurprises to build engagement.asire to fill my home with fresh flowers. There was a rumor in town the prices were amazing, and the flowers lasted well. I wasn’t disappointed, but what I found in the newly open branch apart from fresh food and lower prices intrigued me and has kept me coming back.
For one, staff seem more proactive – for example, they divide their time between stacking shelves and manning tills, depending on the day and the demand. It made me check to see if it was a publicly listed company: it is not.
Bemused customers wander about, many clearly not entirely certain about this new type of shopping experience, where you might find a cycle helmet next to the bird feed. There is a mild air of adventure. In my local branch they were – and regularly are – customers far more representative of diverse Britain than the town in terms of ethnicity, suggesting they come some way to do their shopping. There is also enormous variation in the content of trolleys at checkout, from salmon and champagne to stocking up on baked beans.
Having spotted the multiple Range Rovers in the car park and the queue of cars waiting to turn off the main road into the car park at a weekend many months ago, the fact that Lidl had won Britain’s Grocer Of The Year award came as no surprise to me.
Now the European retailer has done something else which could be seen as throwing down a gauntlet in the world of retail business.
Lidl announced yesterday that it would pay its 9,000 U.K. staff at least the full ‘Living Wage’ from next month. It becomes the first major high street name in the U.K. to embrace  and exceed the higher pay levels recommended bythe Living Wage Foundation, which campaigns for companies to pay staff enough to meet the cost of living.  This is a 14% average pay rise that will cost the German retailer £9m ($14m).
U.K. media has tended to describe Lidl as “secretive” in its coverage in the past. As it is not a publicly listed business, it is not subject to the scrutiny of its rivals. But it has also clearly been biding its time to make its mark before giving away too many secrets.
Ronny Gottschlich, chief executive of Lidl U.K. said yesterday: “We recognize that every employee forms an integral part of team Lidl, and each individual’s contribution is valued. It’s therefore only right that we show our commitment . . . by ensuring a wage that supports the cost of living.”
It is, indisputably, good marketing. Time will tell whether it is also investing in good corporate governance, and that is something business rivals – many of whom have been voluble and lobbying hard about being unable to meet the costs of the U.K. government’s national living wage – might want to think about.