Democracy is More Cumbersome than Dictatorship

Semco went through a radical, democratic transformation beginning in 1980. In 1980, Semco employees "each produced an average of $10,800 worth of goods a year." When Ricardo Semler wrote Maverick in 1993, his employees each produced an average of "$92,000 worth of goods a year (adjusted for inflation)--four times the national average; by the value-added standard, productivity rose six and a half times."

If democratic businesses are more profitable and motivating, then why do people insist on creating oligarchical/command-control organizations? Because...
(1) "so often it is power and greed and plain stubbornness that make bigger automatically seem better."
(2) "secrecy is a strong incentive to be conspicuously greedy."
(3) "bureaucracies are built by and for people who busy themselves proving they are necessary, especially when they are not."

"The era of using people as production tools is coming to an end. Participation is infinitely more complex to practice than conventional corporate unilateralsm, just as democracy is much more cumbersome than dictatorship."

(Quotes taken from Maverick by Ricardo Semler)

Transparency and Limited Power Stop Corruption

"The Church committee (named for Senator Frank Church) looked at a period starting with Franklin Roosevelt and running through Richard Nixon...In every single administration you had failures of control by all the presidents and misconduct by the intelligence agencies...Under all the administrations—six different administrations, both Republican and Democrat—there were misuses of power...(that were) inconsistent with the law and the Constitution.

"The single most important finding of the Church committee was that, if during a time of crisis we ignore the wise restraints that have been put in our constitution and laws to keep us free and keep us strong, we are not only going to make ourselves less free, we are going to make ourselves less safe.

"We’ve slipped as a country into not being as open as we historically (have been) and instead into more and more secrecy, and I think that is one of the underlying root causes (of corruption) that needs to be examined and dealt with." -- Frederick A.O. Schwarz, Jr. (Chief Counsel to the Church Committee)

Bribery is a $1 Trillion Dollar Industry

Daniel Kaufmann, the institute director of Governance at the World Bank, estimates that $1 Trillion of bribes are paid worldwide in both rich and developing countries; One out of every 30 dollars in the world is spent as a bribe.

The World Bank's research "shows that countries which tackle corruption and improve their rule of law can increase their national incomes by as much as four times in the long term, and child mortality can fall as much as 75 percent."

Interestingly enough, the most effective tool to fight corruption has been identified by the World Bank as transparency; ee.gg., freedom of the press, freedom of information, and asset disclosure.

Democratic businesses have found, like the World Bank, that being proactively transparent with all financial information fights corruption, creates efficiency, unity, & understanding, and causes employees to be paid for what they are worth and not for the amount that companies can acquire them for.

Now, if only we could force the World Bank to be transparent...

If you want to help democratize the world, and increase corporate transparency, visit http://www.glassdoor.com/index.htm, enter your salary, and browse the salaries of others within your company and around the world.

(Quotation taken from http://web.worldbank.org/external/default/main?theSitePK=84266&contentMDK=64069844&menuPK=116730&pagePK=64148989&piPK=64148984)

Top Small Workplaces of 2008 Are All Democratic

All the 15 businesses of the Wall Street Journal's Top Small Workplaces 2008 are proactively transparent, 86% share a large portion of profits with employees, all of the businesses de-centralize and limit managerial power, and all of the businesses inspire a euphoric purpose greater than themselves.

All of the 15 Top Small Workplaces are proactively transparent. At Integrated Project Management Co., "each employee sits down for a weekly one-on-one meeting with his or her manager in which they discuss work progress, the employee's performance, and the skills that need improvement." At Jump Associates LLC, "every morning, all employees meet for a "scrum" -- a short get-together where they're briefed on company news." And, the office is laid out so that "all employees, including senior management, sit out in the open in "neighborhoods" of five or six workers." At Lundberg Family Farms, the President hosts a monthly "Meet the CEO" event "where a small group of seven or eight employees chats with him to provide feedback and discuss any concerns." New Belgium Brewing Co., also holds monthly meetings "where it walks employees through the company's financial statements." And finally, at Rainforest Alliance, "employees can do stints in foreign offices to learn more about the organization and work on the front lines."

86% of the Top Small Workplaces share a large portion of profits with employees, and five of these businesses are 100% employee owned. This is especially impressive because employee owned businesses make up only one per cent of all American companies.

All of the Top Small Workplaces de-centralize and limit managerial power. At ATA Engineering Inc., "At least eight to 10 ATA employees are involved in interviewing every job candidate. If one employee objects to the hire, the candidate may not be offered a job unless that employee changes his or her mind." Also, employees "can pursue projects that s/he feels are good for the company or that s/he is personally interested in without needing more than one person's approval." At J.A. Frate Inc., during the only layoffs in 37-years, "the board of directors asked employees to vote on taking a 10% pay cut, promising to reinstate their normal wages after three months. The majority of the employees voted for the cut and all the laid-off employees were later rehired. At Landscape Forms Inc., "if the whole team agrees on one employee's idea, it can be implemented -- without approval from senior management." Rainforest Alliance "gives many junior employees the chance to spearhead research and other initiatives for the organization, later promoting them to oversee those initiatives." And finally, the President of Redwoods Group Inc. caps his own salary at 10 times that of the lowest-paid employee.

All of the Top Small Workplaces inspire a euphoric purpose greater than themselves. The President of ATA Engineering Inc., was "nominated for a local "Entrepreneur of the Year" award. But he turned down the honor, feeling he shouldn't take all the credit for the company's success." At Decagon Devices Inc., "employees take turns bringing home-cooked meals to work for their colleagues." At Jump Associates LLC, "a coach stops in the office a few days a month to help employees with any issue, such as improving their communications or resolving conflicts with a colleague." At King Arthur Flour Co., "even employees who don't work directly with flour are encouraged to learn about baking." At New Belgium Brewing Co., employees are enthusiastic about supporting the company's environmental cause. "Each New Belgium employee is given a cruiser bike," and each year they "dress in costumes and lead local residents on a bike tour." And, "an on-site recycling center allows employees to recycle goods." And finally, At Redwoods Group Inc., "each full-time employee is required to do at least 40 hours of volunteer work annually for nonprofits of their choosing -- on company time." In addition, the company "donates up to $300 annually per employee to charities where employees volunteer their own time."

These companies empower their employees by being proactively transparent, offering ownership, decentralizing and limiting power, and inspiring a euphoric purpose greater than themselves. Democracy is not just giving people a voice. Democracy empowers the voices that people already have.

(Quotes taken from http://online.wsj.com/article/SB122347733961315417.html)