Democratic principles making businesses more transparent

The creativity and empowerment spawned by the Information Age is bringing democracy to work.

from the March 19, 2007 edition

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Whole Foods, the supermarket chain, also uses open-book management. Each store makes available a salary book listing the salary and bonus for each employee. In addition, Fenton says, "The highest-paid executive can't be paid more than 19 times the lowest worker."

Beyond this kind of transparency, Fenton observes two things happening in democratic organizations. One, it offers a method for handling disputes, which varies from company to company. "Second, it's not only conflict resolution, but conflict prevention. There are outlets for people to express their ideas, rather than having them bottled up. There's a forum usually for people to constructively disagree and not take it personally. And employees have a say in decisions that impact them in their work."

At Continuum, a monthly "open town forum" gives the nearly 100 workers an opportunity to share ideas and concerns.

Even hiring becomes a collective activity. "If we're interviewing for an engineering position, we also include designers and strategists as part of that hiring process," Ms. King says.

Mike Feretti, CEO of Great Harvest Bread Co. in Dillon, Mont., brings an egalitarian approach to the company's 224 franchises. Calling it "freedom- franchising," he says, "We require that you use an approved wheat flour to bake your bread with, and you must build on an approved location. Otherwise, we don't make decisions for you." He finds owners are happier and more involved.

Yet even advocates of democratic workplaces agree that they do not work for everyone. "People who need a lot of structure, who live by a job description, would not be happy in our environment," King says. "A job description to us is a guideline. We expect people to go beyond it."

But for those who do "fit," the more casual approach to corporate positions can bring new rewards. "Many of the reasons people get upset at work are eliminated because of the democratic structure," Fenton says. "That translates to more productivity, more efficiency, higher morale, and a better climate."

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