Participation and consultation–token and real
For all their rhetoric, firms are rarely participative or consultative: the dominant practice of modern management is unambiguously directive, from the top down. That is true at every scale of the organization, from CEO to executive, from the executive group to other employees, from business unit heads to business unit employees, from supervisors to the supervised. There are cultural differences in this: in my experience Anglo-American managers and employees take top-down, directive management for granted; so do Asian firms; European firms are more inclined to consultation (but often token); and Australian managers, while attempting to implement the American model, may well have to come to terms with a more intransigent workforce. The prevailing paradigm of modern management is, however, overwhelmingly directive. As we saw in chapter 2, it is built into the Taylorist model of work that underpins the modern workplace model: managers master plan the work elements and their arrangements, and take ownership of the ‘brain’ work, the high-level work which is supposed to be commensurate with their (significantly) greater salary packages. The market certainly believes in top-down leadership: the best market strategy for a public company in trouble is to change its CEO, which will usually see its share price bounce on the touching faith that the new man (usually a man) will transform overnight the performance of the entire company.
Increasingly, however, this model is being challenged. In the European Union, for example, employee participation and ownership has a strong basis in the Community’s Charter of Fundamental Social Rights for Workers, and its adoption by the Heads of Government of the then eleven member states at Strasbourg in 1989. The Charter was remarkable in its grasp of the importance of the workplace to the quality of people’s lives, and the range of issues associated with it. It proposed principles on which the European labour law model was to be based; and, more generally, the role of work in society. A list of its key Articles is in itself an impressive commitment to social values in the workplace:
- Freedom of movement
- Employment and remuneration
- Improvement of living and working conditions
- Social protection
- Freedom of association and collective bargaining
- Vocational training
- Equal treatment for men and women
- Information, consultation and participation of workers
- Health protection and safety in the workplace
- Protection of children and adolescents
- The rights of elderly persons
- The rights of disabled persons
An example of the scope intended to apply to the employment relationship by the Charter is the Directive ‘establishing a general framework for informing and consulting employees in the European Community’, adopted by the European Parliament in March 2002.[i] The Directive implements Article 27 of the Charter, which establishes ‘workers’ rights to information and consultation within the undertaking’; that is, within the enterprise. It requires all businesses with at least 50 employees, or establishments (discrete locations) with at least 20 employees (the choice is left to the member states) to inform and consult with employees on a wide range of matters. These include, as might be expected, the ‘situation, structure and probable development of employment’ in the business, particularly where there is a threat to employment; and ‘decisions likely to lead to substantial changes in work organisation’. But the Directive goes further: it requires information and consultation on ‘the recent and probable development of the undertaking’s or the establishment’s activities and economic situation’. In other words, employee representatives may seek dialogue on changes to senior management, new strategies and vision statements, sales results, demand, new products, overtime, and training and development; everything, in fact, that, in countries such as the UK, has been until now the more or less exclusive province of the executive group.
Many European national labour laws, notably those of Germany and France, have long incorporated the notion of stakeholder voice, as opposed to solely shareholder voice, into the processes of governance and control within companies. Thus in Germany representatives of employees and in some cases other stakeholders, such as local government and environmental interests, are required by law to sit on the boards of public companies. Here company law and labour law are closely linked. The German and French systems are examples of what have been termed ‘insider systems’, which “essentially see the business enterprise as having an organisational dimension which rests on the contributions made by a number of stakeholder groups, and not simply a financial dimension which describes the contribution of the shareholders.[ii]
Moreover, the concept of information and consultation embedded in the Directive, once it is drawn into the practical realities of the work environment, point to a more sophisticated notion of representation, in which democracy in the EU is considered “less in terms of representative democracy and more in terms of participation and deliberation. . .[it] places the emphasis on obtaining a shared sense of meaning and common will. . .on arguing, reason giving and learning, leading to the transformation, rather than simply the aggregation, of preferences.”[iii]
This is a strong statement of principle, a commitment to a particular view of work life, and a transformed employment relationship in the direction of what is increasingly being termed a ‘partnership’ model. It is not a theoretical aspiration: the Directive is a reality. It has been binding on all businesses of EU member states since 2005, although predictably it was resisted by Boards and management.[iv]
However, it’s worth considering what the right to information and consultation might mean in practice. Like many policies, the devil is in the detail, in this case the detail of how the management of the firm chooses to interpret that right. As useful framework for considering this question is the IAP2 Public Participation Spectrum[v]. Although it was designed for use in public contexts, the Spectrum is directly relevant to organisations as well (one can argue against equating these contexts, but I am prepared to argue that the principles underlying the two are common and map well onto each other). It sets out a continuum of possible relationships between central agencies (in this case, management) and stakeholders (in this case, employees), as follows:
It is evident that these categories, read left to right, move from least to greatest participation. The Spectrum then lays out for each category the nature of the participation goal which characterises each of these categories (here the term ‘employees’ has been substituted for the original ‘public’):
|To provide the employees with balanced and objective information to assist them in understanding the problems, alternatives, opportunities and/or solutions.||To obtain the employees’ feedback on analysis, alternatives and/or decisions.||To work directly with the employees throughout the process to ensure that employees concerns and aspirations are consistently understood and considered.||To partner with the employees in each aspect of the decision including the development of alternatives and the identification of the preferred solution.||To place final decision-making in the hands of the employees.|
The management undertakings which are linked to each of these goals are then identified:
|We will keep you informed.||We will keep you informed, listen to and acknowledge concerns and provide feedback on how employees input influenced the decision.||We will work with you to ensure that your concerns and aspirations are directly reflected in the alternatives developed and provide feedback on how employees input influenced the decision.||We will look to you for direct advice and innovation in formulating solutions and incorporate your advice and recommendations into the decisions to the maximum extent possible.||We will implement what you decide.|
These categories seem to capture well the different stances that management in modern firms adopt with respect to participation and consultation ( ‘management’ here, rather than ‘managers’, because the stance is nearly always one of the firm’s policy, reinforced by cultural norms). Clearly the first three of these categories (working from the left) are associated with top-down management. The first category is blunt and unpromising, from the employee point of view: “we will keep you informed.” The second two categories seem at least to embody degrees of interchange, and acknowledgement of the two-way character of anything that resembles participation. However, I would be prepared to bet that many people reading the first three columns in this table, and reflecting on their own workplace experience, would be sceptical of the commitments articulated here, even at the most basic level. All too often management curtails information, avoids action on feedback, and fails to follow up consultation. This is tokenism, pure and simple; it is designed to meet regulatory requirements (such as those in Europe) and to divert the demands of employees for participation into harmless channels (that is, channels that are peripheral to centralised decision-making), while providing a ground for presenting the company as progressive to the community and the market. In my experience, tokenism is far more often the rule than the exception in modern workplaces.
The irony is that, while designed to shore up the Taylorist structures which dominate modern management, tokenism seriously damages the organisational fabric. Nothing undermines trust between management and employees so quickly or so thoroughly. Once dismantled, trust is very difficult to restore. A firm embarking on this path would be better advised not to undertake such measures at all: at least uncompromising, unambiguous control-and-command management has an element of honesty about it. It is the dishonesty of token participation and consultation that employees find difficult to forgive. A shutdown of discretionary work and a retreat to work-to-rule is the almost inevitable result.
But a second reason employees react in this way to token consultation is that their expectations have been disappointed; and that is worth examining. These are expectations of ownership. The opportunity to play an active part in the decisions and implementation of their work is greatly valued by most people. The value of ownership rests first in the satisfaction of seeing my own decisions and actions worked through into useful outcomes, in products and services and the contributions they make, although that is important. But even more, perhaps, the ownership that is embedded in real participation is a mark of respect: an explicit recognition that my ideas, opinions and actions matter, that they are valuable; that I may be employed but not as an object, a factor of production, like plant or equipment; that I am trusted to take on responsibility for important outcomes; that I matter, as a person, with all the creativity and intelligence that human beings bring. All healthy relationships are founded on mutual respect, and the employment relationship is no exception. That is why participation and consultation promises so much, and why the betrayal (it is not too much to use the word, in my experience) of that promise in token participation is so damaging.
Is it possible, then, for firms and organisations really to implement the third and fourth categories in the IAP2 Spectrum, ‘Collaborate’ and ‘Empower’? The European Directive seems to believe it is, since the right to information and consultation, as we have seen, is interpreted there as “obtaining a shared sense of meaning and common will. . .on arguing, reason giving and learning, leading to the transformation, rather than simply the aggregation, of preferences.” This represents truly engaged, shared consultation where there is learning on both sides and the outcome can actually be changed by the process–hallmarks of the Collaborate/Empower modes.
Increasingly, too, there is a recognition among many leading firms that in the modern business environment these participation modes are not only possible but required. That is, the business case for them is becoming strong.
Firstly, there is an absurd hubris in the idea that one person, the CEO, is somehow the fount of all the knowledge that the success of the business requires. As noted, the market seems to hold tenaciously to this view, and far too many CEOs fall into the trap of believing that it’s true. But it beggars belief that in a globally-connected world of immense complexity, with interacting systems of extreme volatility and unpredictability, any one person could plot a coherent business course. The best CEOs know this is rubbish: they may present themselves as charismatic messiahs to the market, but they know better than to manage like that. Jack Welch, for example, the well-known (somewhat notorious) CEO of General Electric, presented a public persona of absolute managerial control; but he is said to have collaborated closely with his senior people and was one of the first managers of modern times to understand that the employees of the company were an immense creative resource–he sent his managers onto the shop floors to seek out critiques and ideas, and installed computer terminals to make direct communication with him simple. Michael Chaney, the former CEO of Westfarmers, is said to be another example: in creating one of the most successful conglomerates in Australian business history, he assembled an outstanding group of business developers and worked closely and collaboratively with them. Modern companies like Google, operating at the forefront of the Internet space, live and breathe this reality. In a sector that is evolving at breathtaking speed, significant managerial power has devolved to semi-automous teams in order to allow for maximum creativity and flexibility in new product development.
Second, it is now well understood that all kinds of knowledge comes with people. Certainly employees can be hired for specific knowledge (note, specific–that is, tied to a particular job description and element in the work process, as required in the Taylorist model). However, people know a great deal about many things that lie outside the job description, and often a great deal about knowledge that is relevant to other people’s jobs. The firm’s knowledge base can include all this knowledge, if it is opened to employees. All too often it is not: the fear of losing control is ever-present and, in true Taylorist mode, renders real devolution of power anathema to modern managers. Yet, it seems reasonable to ask, in an environment of accelerating and violently fluctuating change, where are the new ideas–the ideas necessary to meet this change and flourish in it–going to come from? Clearly a wise firm will look first to its own people for that critical knowledge; and that requires establishing structures whereby people can participate directly in decision-making.
But beyond the business case for collaboration and empowerment is, as I argued in chapter 3, is the ethical and human case; and in my view it is primary. I’ve noted the crucial importance of ownership: it’s not too much to say that no really creative and valuable work can be developed in any organisation without it. But I want to argue further for the fundamentally ethical commitment that underpins ownership. It derives from Kant’s ‘respect for persons’ principle, which is, you will remember from chapter 3, ‘always treat humanity in a person as an end, never as a means’. It is simply not enough, from an ethical point of view, that people have a defined role in the production process, along Taylorist lines. It must be a role that they themselves value, a role which is important and valuable to them, as people, as they go about their lives and look towards fulfilling their own potential; and that means, fundamentally, they it must be work over which they themselves have significant control. We can expect–and indeed research confirms–that ownership is associated with greater creativity, commitment, motivation and productivity, but that is not, in the end, why it should be a part of the working environment. It is rather an inseparable part of the commitment which comes with employment, to treat people with respect, to ensure that their work is not alienated from them, that it plays its part in a fully human life. The commitment to ethical practice business–in this case, to real ownership–is not primarily driven by the profit motive but by a commitment to humanity: as Norman Bowie has it, it comes ‘with no ifs and buts’[vi].
Finally, I want to argue that at least part of the reason participative decision-making is so rare in business is that managers don’t know how to put it into practice. This is surprising, as we work collaboratively together in all kinds of social contexts outside business; but we have noted that strange misalignment from the beginning of this book. Here are some general principles, drawn largely from my own experience, for participative, collaborative thinking:
- In general terms a group is usually more intelligent, even wiser, than a single individual. One can easily think up exceptions–the matter is very technical and someone has the required technical skills; or the group is beset by personality problems–but the general principle still holds.
- Collaboration tends to bring out the best in people. Not only is it in itself a central part of work fulfillment–most people enjoy working together–but the interpersonal commitments that emerge in a group predispose people to give their best.
- Successful collaboration is based on attentive, intelligent listening, rather than talking. All too often individuals in collaborative groups are thinking about what they want to say next, rather than attending to what is being said by someone else. The first commitment of members in collaboration is to listen and understand, before speaking.
- Anything can be put forward by anyone: the whole point of collaboration is to expand the range of ideas, to enhance creative thinking. Whatever is put forward is to be listened to with respect. It can be the subject of disagreement, but that too must be respectful, at the individual level. Personal disparagement or even abuse is absolutely unacceptable, and is agreed by everyone in advance to be unacceptable.
- Disagreement or different positions in a group is fine: often it indicates that there is a deeper level of understanding to be reached, which can accommodate the different positions, and which is therefore more powerful.
- As a general rule transparency and openness are better than keeping information back. The default position should be: all information is freely available to everyone, unless it involves agreed limitations, such as personal privacy, or commercial in confidence matters. Not only does transparency allow for the highest levels of creative thinking but it enhances trust; just as the opposite, refusing to release information, dismantles trust and generates suspicion. Information in organisations is power: holding back information initiates power relations; and once power relations come into play the coherence of the collaboration is lost.
- For a manager, accepting the principle of ownership of decision-making by a collaborating group means accepting that it may well make mistakes–and supporting them when that hapens, rather than walking away. It also means celebrating successes collectively, rather than taking credit for them. It means becoming part of the group, participating fully in it as one of its members, fully invested in it, not standing apart in isolated managerial splendour.
Respect, trust, openness, honesty, fairness, generosity, consideration: these are the elements of good participation and collaboration. But that should hardly come as a surprise, to anyone. If you’ve grown up as a member of the human race and haven’t worked these things out, you haven’t been paying attention.
[i] ‘Directive 2002/14/EC of the European Parliament and of the Council of 11 March 2002 establishing a general framework for informing and consulting employees in the European Community’, Official Journal of the European Communities, EUROPA, Employment, Social Affairs & Inclusion,http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2002:080:0029:0033:en:PDF
[ii] Barnard, C. & Deakin, S. (2002). ‘Corporate governance, European governance and social rights’ in Hepple, B.(ed)(2002). Social and Labour Rights in a Global Context. Cambridge University Press, Cambridge, United Kingdom, p.133.
[v] International Association of Public Participation Australasia, Public Participation Spectrum,http://www.iap2.org.au/sitebuilder/resources/knowledge/asset/files/36/iap2spectrum.pdf
[vi] Bowie, N. (2002), ‘A Kantian approach to business ethics.’ In T. Donaldson, P. Werhane & M. Cording (eds.) Ethical issues in business: a philosophical approach. Upper Saddle River, NJ: Pearson Education.
The Fractured Workplace And Its Remedies by Geoffrey Wells is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License.