The Modern Corporation: Why is it bad?

[johnny861]

People seem to worry about is globalization and the change to the service economy and how evil all corporations are, so they bring up points about protectionism and the industrial economy and evil mechanistic corporate structures...


what people don't realize is that we are transitioned to a global economy, very interwoven with many nations on this planet, and not only are we in a service economy, but we are beginning the first stages of transitioning into a human economy. And many corporations no longer follow the mechanistic structure that you saw in the better have of the last century. Many corporations have changed their structure following many modern business models to compete with a consumer driven global market.


The first stages of transitioning into a service economy and globalization really got started around the 1970s in ways that started impacting people.

30 years later, we have people giving a blanket argument against corporations, only seeing them as their mechanistic counterparts that were forged in the 1920s, while modern corporations, like Hotels.com and Ebay have taken on new business models...

Some Corporations, like TDI Industries, have practiced Servant Leadership on a scale that is close to ParEcon (Participatory Economics), which is a very liberal view of how corporations should operate. http://www.parecon.org/


Arguments against corporations in general, based on dated views, ignores corporate transitional trends from the 1950s style military organization of corporations to team facilitation and servant leadership style corporate structures.

Our company, for example, follows servant leadership as a business model. Companies from The Container Store to TDI Industries also follow this model. http://www.greenleaf.org/

TDI Industries gives all it's associates (employees if you will) part ownership in the corporation and practices open book management so that all associates are aware of how the company is doing and can help contribute to the welfare of the company to benefit themselves.

You guys should really read up on some literature on modern corporate structures and modern economic theory.



The days of the mechanistic corporate dinosaur are numbered as they will find it increasingly hard to do business in this changing economy for a number of reasons. From consumer trends to employment retention.


Every system is going to have flaws and corruption, what system doesn't? This is why we need to have legislation like anti-trust laws in place and to continue providing legislation that will help ensure companies don't step out of line and become the evil corporations that we dread about in our dreams.

However, why put a blanket blame on all Corporations because of a corporation like Enron and ignore all the good that corporations also provide?

[Adam D]

I think you're ignoring part of a larger argument about the control corporations have on the country (and the world) as a whole that goes beyond their structure.

It's good that some corporations are beginning to include workers in decisionmaking. What's ironic is that these ideas were thought up by business educators and professionals as a serious model only within the past 30 or 40 years, while these ideas were formulated by workers over 150 years ago.

I don't think Servant Leadership is very close to ParEcon, and I think Michael Albert (the man who created ParEcon) would agree with me. First of all, the very title of it is demeaning. If you refer to the process of worker decisionmaking as servant decisionmaking, then you aren't going to be taken as seriously as you should, because the workers are still seen as beneath management as workers. Second, the decision to allow workers decisionmaking power is still one held at the top, not at the bottom, and can be removed or coopted at any time. That might be a step in the right direction, but it is still one that alienates workers from total decisionmaking power. That's what ParEcon is. Don't get me wrong, I think SL is a better option than total top-down control, but equating it with a likeness to ParEcon coopts further reform, in my opinion, and ignores the rest of the changes Albert champions.

While I think this will become a growing movement within corporate circles to better empower workers, the majority by far of corporations do not practice any worker decisionmaking processes, especially the larger and less concentrated corporations. Those are the ones I at least, find problems with.

[johnny861]

[QUOTE]Originally posted by Adam D
I think you're ignoring part of a larger argument about the control corporations have on the country (and the world) as a whole that goes beyond their structure.



It's good that some corporations are beginning to include workers in decisionmaking. What's ironic is that these ideas were thought up by business educators and professionals as a serious model only within the past 30 or 40 years, while these ideas were formulated by workers over 150 years ago.




I don't think Servant Leadership is very close to ParEcon, and I think Michael Albert (the man who created ParEcon) would agree with me. First of all, the very title of it is demeaning. If you refer to the process of worker decisionmaking as servant decisionmaking, then you aren't going to be taken as seriously as you should, because the workers are still seen as beneath management as workers. Second, the decision to allow workers decisionmaking power is still one held at the top, not at the bottom, and can be removed or coopted at any time. That might be a step in the right direction, but it is still one that alienates workers from total decisionmaking power. That's what ParEcon is. Don't get me wrong, I think SL is a better option than total top-down control, but equating it with a likeness to ParEcon coopts further reform, in my opinion, and ignores the rest of the changes Albert champions.


I did not equate Servant Leadership to ParEcon, I apologize if that sounded a bit misleading.

What I did make a comparison to is TDI Industries use of Servant Leadership and it's associate involvement in decision making as being close to ParEcon. If you read up on literature about TDI Industries and corporations like then, you will find that all associates participate in decision making, with the top management making a final decision based on the concerns of its associates.

Stock holders at TDI Industries? The largest owner of stock in TDI Industries is a sheet metal press operator. He owns several million in stock. He has just as much a say in corporate decisions as his counterparts and management, yet they follow a corporate structure where each associate be it the press operator or the supervisor has specific duties to attend to. Large corporate decisions such as cut backs, include all associates in the decision making process.

How is this not even close enough to ParEcon to create even a small comparison?



While I think this will become a growing movement within corporate circles to better empower workers, the majority by far of corporations do not practice any worker decisionmaking processes, especially the larger and less concentrated corporations. Those are the ones I at least, find problems with.

Again, there are very large corporations that still follow the mechanistic corporate structure, but this is also an issue these large corporations face.

The growing trend in the 1980s was to create sectors within a corporation to deal with the large nature of the business, this has been met in the 80s with marginal success. As corprations deal with business trends in the 21st century, the advice given to them is to create addistional sectors and split out even more. This is proving less effective as many issues are developing with information integration causing a breakdown in the quality of CRM.

They are faced with a certain reality that this transitioning is affecting them as well and slowly corporations are having to rely more on their associates in decision making process.

There's a good article written about the problem with CRM in large corporations that points out the problem with mechanistic corporatins in the 21st century and goes on to give a warning that such business practices have to change.

[johnny861]

In additional, Michael Albert talks about a company he was apart of in Canada, that although does not serve as a true guideline of ParEcon in motion, creates a basis for other corporations to follow. This company is not that much different than the way TDI Industries conducts business.


Now, Michael Albert is a socialist and I can see similarities between ParEcon and Communism and while I don't agree with the overall ideology of ParEcon, many principles of the theory are incorporated into other Capitalistic Business Models.

But, I do understand that ParEcon, itself, is anti-capitalistic.

[Adam D]

Originally posted by johnny861
I did not equate Servant Leadership to ParEcon, I apologize if that sounded a bit misleading.

What I did make a comparison to is TDI Industries use of Servant Leadership and it's associate involvement in decision making as being close to ParEcon. If you read up on literature about TDI Industries and corporations like then, you will find that all associates participate in decision making, with the top management making a final decision based on the concerns of its associates.

Stock holders at TDI Industries? The largest owner of stock in TDI Industries is a sheet metal press operator. He owns several million in stock. He has just as much a say in corporate decisions as his counterparts and management, yet they follow a corporate structure where each associate be it the press operator or the supervisor has specific duties to attend to. Large corporate decisions such as cut backs, include all associates in the decision making process.

How is this not even close enough to ParEcon to create even a small comparison?

I think that it is a positive step towards one aspect of ParEcon, but I don't think it's quite as inclusive of a change as ParEcon is, specifically in terms of renumeration and balanced job complexes.

The real difference is that decisions are still being made top-down, whereas ParEcon is bottom up. SL and similar practices are different business models in that instead of being autocratic, they moving more towards a procedural democratic model. That's not quite the same as ParEcon.

[Eddie Archive]

Damn...i never realized that....

[Adam D]

Originally posted by johnny861
In additional, Michael Albert talks about a company he was apart of in Canada, that although does not serve as a true guideline of ParEcon in motion, creates a basis for other corporations to follow. This company is not that much different than the way TDI Industries conducts business.

I'm not suggesting that the SL model is bad or a step in the wrong direction. I think quite the opposite. But in terms of what TDI does it's closer to market coordinism than it is ParEcon (his words, not mine).

Now, Michael Albert is a socialist and I can see similarities between ParEcon and Communism and while I don't agree with the overall ideology of ParEcon, many principles of the theory are incorporated into other Capitalistic Business Models.

But, I do understand that ParEcon, itself, is anti-capitalistic.

Well, he's not a socialist in the Marxist sense. He's actually a social anarchist, which is libertarian socialism. He's never advocating government control of the economy (although sometimes I question that) rather it's worker owned and controlled. I will buy that there is some similarity to what Marx referred to communism as, albeit completely different from what was implemented as communism.

I agree that many of these principles are being incorporated into current business models. I would not attribute this to Albert though. He has taken these ideas from the ideas of the labor movement of the 19th century, where these ideas were initially professed by common workers. In fact, these ideas were espoused by workers at an equivalency of today's Wal-Mart employees.

[johnny861]

Originally posted by Adam D


I'm not suggesting that the SL model is bad or a step in the wrong direction. I think quite the opposite. But in terms of what TDI does it's closer to market coordinism than it is ParEcon (his words, not mine).



Well, he's not a socialist in the Marxist sense. He's actually a social anarchist, which is libertarian socialism. He's never advocating government control of the economy (although sometimes I question that) rather it's worker owned and controlled. I will buy that there is some similarity to what Marx referred to communism as, albeit completely different from what was implemented as communism.

I agree that many of these principles are being incorporated into current business models. I would not attribute this to Albert though. He has taken these ideas from the ideas of the labor movement of the 19th century, where these ideas were initially professed by common workers. In fact, these ideas were espoused by workers at an equivalency of today's Wal-Mart employees. [/B]

Aside from LLP employing only the partners, I am having a difficult time envisioning a bottom-up corporation and perhaps some of that is clouded with various practices and/ or obstacles found in a top-down corporation, especially concerning growth.

On the otherhand, when associates are "in the trenches" as it were, it can be easy to lose sight of a corporation's ultimate mission, or what's be recently coined a BHAG . The ultimate goal or set of goal's that drive's the corporation's mission statement or it's "spirit" if you will.

It's easy to lose sight of that when ones job is to sit in front of a computer 10 hours a day and manage pieces of data.

I suppose corporations could have regular "pep-rallies" to reinforce it's ideals and focus (and some do), but there is a reason why so many office worker's can relate to the movie "Office Space"... A natural rebellious nature is sure to intervene as it does here with our weekly SL meetings to determine a focus for next week's goals, not to say this is exclusively the issue.

Most of the associate's typical reponses I tend to hear at my company: "I'm too busy to be sitting here, it's a waste of my time" or "isn't this supposed to be what the management is supposed to be doing?"

However, there are plenty of associate's that find these meetings value added and important for the welfare of our company.

Ironically, most of these participating people are the lowest paid people in the company, yet appear to be the group most content with the company.

Their responses typically consist of, "It's really good that they share all this information with us" or "I've really understand now about how our company does business in regards to (Etc)."

Perhaps there is a pattern here that needs to be addressed in some fashion with corporations.

However, not to discourage the idea, it would be very interesting to see a corporation with a bottom-up model develop and perhaps our progression into the human economy will spur the need for this kind of organizational behavior.

The neat thing about Businesses, unlike government, is that they have the freedom to organize themselves however they see fit, which have produced excellent businesses so far by leaders willing to take that kind of risk.

[Adam D]

Take it as what you want, this is what Albert said to me:

I have never heard of it -- but in general corporations implement
schemes with the purpose of maximizing proft -- sometimes they opt for
something that ups output per asset to thereby raise profits, and
discover later that it had the debit of increasing worker organization
and strength to that workers took more of the enlarged revenues than
owners, and then they revert to old ways.