My Thoughts on: Lynda Gratton (2004) The Democratic Enterprise. Liberating Your Business with Freedom, Flexibility and Commitment. Prentice Hall

The other day I was strolling around in the library – something that I often used to do in past but only occasionally nowadays – when the above book caught my eye. Without looking into the book, I borrowed it and spend the next two train rides to work reading about the democratic enterprise and the results and conclusions Lynda Gratton draws from her democracy study. Even if it has been published quite a few years ago, I think it would be worth sharing my thoughts about it.

The book takes as its outset the tales of three citizens that happen to be exemplary stories of employees, who adopt the stance of a citizen while working in an organization. Afterwards we delve into the history of democracy learning about classical, liberal, direct, competitive/elitist, and legal democracy. The author continues by turning towards what she refers to as the tenets of the democratic enterprises. According to these tenets, employees (should) become labelled ‘citizens’, who firstly engage in an adult-to-adult relationship with their employer and in return expect that the employer treats them as adults as well. Secondly, as citizens, employees become investors in the organization that they work for seeking to build and deploy their human capital. Thirdly, in democratic enterprises employees are enabled to become, who they want to be, and thereby – the author refers to John Stuard Mills here – to frame the plan of their life to suit their own character. Fourthly, as investors, employees can determine the conditions of their association with the company, hence, decide to invest or de-invest, amongst other things. Fifthly, even though the liberty of the individual employee is a central value in the democratic enterprise, the liberty of some individuals should not be at the expense of others. Creating win-win-situations is key in this regard. From this follows that, sixthly, individual employees are not only accountable to themselves. They have accountabilities and obligations to the organization as well.

In her democracy study (conducted between 1993 and 2000), Lynda Gratton investigated to what extent these tenets are visible in the practices of contemporize organizations. She devotes one chapter presenting the results of the study, thereby showing how employees of Citibank, GlaxoSmithKline, Hewlett-Packard, Kraft Foods, Lloyds TSB. Parcelforce, and Chelsea and Westminster Hospital experience the above tenets of democracy to be realized in their daily work.

After these more descriptive chapters, the book takes a normative turn. Lynda Gratton describes some of the aspects that drive contemporary organizations towards democracy and she elaborates the building blocks of creating the democratic enterprise. According to the equation that she offers, individual autonomy + organizational variety + shared purpose add up to the establishment of the democratic enterprise. Explaining each of these building blocks, Lynda Gratton shows how organizations can bring the democratic enterprise into reality by addressing numerous so-called key elements. Who the organization is, respectively, who stands in front of creating the democratic enterprise becomes transparent in chapter eight, where the book discusses the role of the CEO and leadership team (as philosopher and visionary), the team leader / manager (as creator of space and goal setter), and HR (as creator of insight and builder of trials and experiments).

The book ends with a chapter providing five good reasons for why managers and leader should establish a democratic enterprise: Employees would be more engaged, win-win solutions would be established, the organization would be more just and fair, more agile, and finally more able to integrate.

This last chapter does the final bit of suggesting a shiny future to all organizations that are successful instrumentalizing the idea of democracy for economic purposes. In so doing, the book makes the notion of democracy and citizens functional for organizations’ efforts towards becoming economical effective. If only the leaders and managers are able to create the conditions that enable employees to feel and act as citizens, the democratic enterprise will be able to use them most effectively, while it simultaneously makes them feel good. In this way the democratic enterprise will be able to outperform its competitors that have not yet understood exploiting the notion of democracy for their business. You may interpret this as my critical stance towards the book, and you rightly do so. I think it is problematic to turn the idea of democracy into a commodity, hence, putting a price tag on it to determine its value for the capitalist economy. I am also concerned that the book, as it speaks to employers, tends to reinforce an unequal relationship between managers / leaders and employees. It is the former who have the capacity and responsibility to create the conditions for the democratic enterprise, while the latter are largely expected to passively react to these conditions by behaving and performing as citizens. By the way, the term ‘citizen’ receives a specific connotation in the democratic enterprise that deviates from notions of someone, who is entitled to the rights and privileges of a freeman. To what extent can employees in capitalist organization be regarded as freemen or freewomen? The book does not take into account the effects of capitalist conditions of paid employment, particularly the antagonistic relationship of capital and labor and the subsequent exploitation of employees. It rather seems to offer a way of creating a win-win situation for employers and employees alike, which one could challenge as even the democratic enterprise continues to exploit its employees.

However, despite this critique, what would actually happen to the world of work if the idea of the book would spark the interest of employers? Wouldn’t this have the potential of ameliorating the conditions of some if not many employees? I think that one could probably argue that the working conditions of employees might improve if more organizations would decide to live up the principles that this book develops. If employers would (at least try to) treat their employees as adults (not as infants or puppets), enable them a fair degree of influence on their workplace and working conditions, and allow employees to have their paid work contributing to their personal development, for some the work experience and therefore their life could indeed be shinier.

Yes, I know, this reads old fashioned as I connect to humanist ideals proposed by the human relations movement in the beginning of the past century. For some it may also read naïve as the democratic enterprise would only constitute a more sophisticated form of control in organizations, wouldn’t it? Being aware of such critique, I cannot help continuing to believe that also small steps could contribute to make this world a little bit better, well knowing that what better actually means is of course open to dispute.

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