From GOHWP Member Matt Grabowski, IUPUI Doctoral Candidate, USA

Democracy is a cornerstone in western society. Many major governments operate utilizing the principles of democracy such that their citizens are encouraged to participate in their government and that the voice of the people can be heard. Though it has its flaws, we consider democracy to be superior to any other form of governance, yet organizations often do not operate by these principles.

Even organizations that employ thousands of people are usually governed by just a handful who use their resources as they see fit, even if their actions are not in the best interests of the majority. It seems counterintuitive to believe that people collectively should have control over how they are governed in greater society but not in the businesses they spend nearly one third of their life working. The concept of organizational democracy differs entirely from the typical hierarchical power structure by bringing many of the same principles we use in a democratic society into the organization.

Organizational democracy is exactly what it sounds like. It is employing the principle of “one person, one vote” into the workplace to ensure a voice is given to all workers. Organizational democracy is not as simple as just giving everyone a chance to vote on certain topics, this is a system that is built into the structure of the organization that guarantees the power of the majority. Specifically, employees in democratic organizations are tasked to participate in all levels of decision making with equal weight, and this is considered part of their responsibilities to the organization. These decisions range from simple proximal things (e.g. employee PTO or the purchasing new equipment for their department) to large scale decisions (e.g. what products/services will the company offer and how the profits are distributed).

A few companies exist using this type of model. The most notable example, Mondragon is worker cooperative federation which is made up of 261 companies and co-operatives (including a university) which collectively employ 74,335 people. The company was founded in Spain over 60 years ago and now operates internationally. As a democratic system, members of the co-operative federation participate in decision making collectively by form of a congress in which the members are elected to their positions to represent their respective co-operative members. While some members of the organization may hold a higher elected position, even lower member still get to participate with their vote being equally weighted.

The bulk of the research on organizational democracy is theoretical and comes from outside the field of psychology. Research in sociology and economics seems to focus on the larger impact of democratic organizations within society, but research at the organizational level and the individual level seems limited. Research from applied psychology fields have addressed the effects of culture and structure on democracy in the workplace, attitude and motivational differences of employees in democratic organizations versus non-democratic organizations, and even the effects of democracy on a few behaviors like organizational citizenship behaviors. This leaves ample opportunity for continuing research for I-O, especially on the “I” side such as considerations for hiring, performance appraisal, and training just to name a few topics. Plus, given the broader implications of organizational democracy increasing equality and the general welfare of people, this should be a topic to further explore in the HWP realm as well.

In summary, organizational democracy would mean bringing our societal form of governing down to the organizational level. Though this seems like an odd and unusual form of running an organization this organizational structuring exists and there is evidence that it is effective. We in the I-O and HWP fields have only begun to explore this topic and much more research still needs to be done! If democracy is the key to participation and equality, then organizational democracy is the next logical step in our society.

Further readings

Weber, W. G., Unterrainer, C., & Hoge, T. (2008). Socio-moral atmosphere and prosocial and   democratic value orientations in enterprises with different levels of structurally anchored participation. German Journal of Research in Human Resource Management, 22, 171-194. doi:10.1177/239700220802200205

Wegge, J., Jeppesen, H., Weber, W., Pearce, C., Silva, S., Pundt, A., … Piecha, A. (2010). Promoting work motivation in organizations: Should employee involvement in organizational leadership become a new tool in the organizational psychologist’s kit? Journal of Personnel Psychology, 9, 154-171. doi:10.1027/1866-5888/a000025

The Sociological Quarterly Volume 57, Issue 1 (the whole issue is on democracy at work)

A link to Mondragon’s website