IMAGINE a company where you are free to build or realise your potential. Where you have choice and flexibility in the time and location of your work. And where you can balance work and life.
Would you choose to work with such a company? Author Lynda Gratton, who calls such company a “democratic enterprise”, thinks so. In reality, though, it really depends on the “total package” that the company offers you.
A democratic enterprise has a high level of individual autonomy and organisational variety as well as shared purpose. If a company is not democratic, it’s either autocratic, bureaucratic or adhocratic. Gratton believes that successful organisations of the future are democratic enterprises. This is arguable because successful organisations can be those that are democratically autocratic.
With the word “democracy” in its title, the book is bound to generate a mixed reaction. Reason: The East and West view democracy differently. The East tends to associate it more with politics than with business. As such, you may wonder if “The Liberated Enterprise” is more apt as a title.
Nonetheless, why be democractic? Firstly, employees who experience democracy are more engaged and committed. Hence, they are more likely to have the company’s interests at heart, can be trusted to behave in the company’s interests, and have less need to be controlled and measured. But are the people and companies in the East ready for such democracy?
Secondly, democratic enterprises create win-win solutions. For example, you win because you are able to work from home and create a balance in life. Your company wins because your talents and insight remain with the company rather than going to a competitor. This is definitely true.
Thirdly, they create and support justice and fairness in the company’s procedures, distribution of resources, and interpersonal interactions. This in turn increases your engagement with your company.
Fourthly, autonomous employees create agile, adaptive organisations for they are more alert and responsive to changes in the business environment. Not necessarily.
And finally, democratic enterprises have better integration capabilities, regardless of whether the organisation is growing organically and non-organically. This is especially true in initiating, driving or managing change.
What are the drivers to democracy in enterprises? Firstly, individuals of all ages are becoming more and more receptive to the ideas of autonomy and, as a result, demand more organisational variety. Which brings us to the next driver: Technology. Advancements in technology, in particular software technology, have the capacity to make available an enormous amount of previously restricted information. But what makes an enterprise democratic? Gratton offers six tenets:
·The relationship between the organisation and the individual is adult-to-adult
·Individuals are seen primarily as investors actively building and deploying their human capital
·Individuals are able to develop their natures and express their diverse qualities
·Individuals are able to participate in determining the conditions of their association
·The liberty of some individuals is not at the expense of others
·Individuals have accountabilities and obligations both to themselves and to the organisation
Gratton examines these tenets at work in seven large, supposedly successful democratic companies in Britain. Question is, can the support of the six tenets of democracy build a financially successful organisation? Gratton’s answer is an unequivocal yes. But how unequivocal is that stand when Sony – one of the companies cited in the book – is bleeding profusely at the moment?
Gratton says, “Many people feel disconnected from their organisation.” But if managers expect this book to help them otherwise, they may be disappointed. Reason: With 254 pages and in small print, it is heavily academic as well as philosophical as opposed to being practical.
The book’s core message – liberating your business with freedom, flexibility and commitment – is relevant. It is not a groundbreaking book but very beneficial, especially to managers who have “dinosaur-era” mindsets, who want to be more effective in managing or leading a modern-day workforce.