Are leadership and democracy truly compatible?

democratic leadership illusion

Is true democracy possible? Or is leadership that makes everybody happy an illusion, just like the North Korean picture above? Is it really possible to always make everyone happy? Where in the world do we have perfect democracy? Can true democracy, for instance, be practiced in a business? Would one employee – one vote make it possible not only to run a company but also make sure it’s profitable? Definitely, if you are a small jointly owned company. But how about a huge multinational with say, 250,000 employees?

Imagine if all employees had to vote before a decision was made. Everybody would be looking after number one and the company would not only be ungovernable but lose money as well.

Fair decisions based on dialogue

Different stake holders having their say and aiming for fair and emphatic decisions based on dialogue is definitely not only possible, but already practised in a multitude of companies.

Democracy – next fad in leadership theories?

With all the current emphasis on empathy in leadership I can’t help wondering if democratic leadership will soon become fashionable? The timing is right because many employees feel they have been badly treated by management during the economic crisis.

Leaders are solely responsible

As a leader you are responsible to the board, share holders and all employees. There are no excuses for chosing the wrong path. You, and only you, are accountable and pay the price if your decisions fail. Or as President Truman put it, the buck stops with you.

Show me a truly democratic government

In all democratic countries politicians are elected because they promise the electorate they will do X,Y and Z. However,  once in power they frequently proceed with doing something else. Sometimes because they discover that what they would like to do isn’t possible for, usually, financial or legal reasons. Isn’t democracy more of a concept than reality? How much say does the electorate really have? The fact that a lot of politicians say what the electorate wants to hear and then do something else, doesn’t help. To get votes by pretending you stand for something you don’t is not how democracy should workk. But that is what happens in most countries.

In fact I don’t believe you can find any democratically elected government in the world that hasn’t failed to deliver on quite a few of their promises. As we all know, private companies operating that way would eventually cease to exist.

Was Churchill right when he claimed that democracy is not perfect, just the best way of governing we have, so far, discovered?

Staff can’t have more influence than board and shareholders

It’s impossible to allow employees to have more impact on decision making than the owners and board of directors do.

Sometimes taking decisions can be severely difficult and you will have to defend them not only to shareholders but colleagues as well. It’s particularly hard if you don’t agree with some of the decisions implemented. But you still have to be able to handle criticism for them and make sure as many as possible understand, accept and are motivated by your decisions.

Do you believe perfect democracy exists in any company or government in the world? How much more democratic can the corporate world get without jeopardizing the businesses? Is it possible to ever satisfy all and sundry and still be profitable and grow? A bit of a Catch 22, isn’t it?

Picture: Yeowatzup

122 thoughts on “Are leadership and democracy truly compatible?

  1. Such an amazing post dear 🙂
    You have raised a good question; however, the answer to the question is tricky. Haven't even seen transparency in the government work. So what to say more…we may be voting to elect parties or individuals, but they must take the responsibility of completing the promises made before elections.

    1. Yes, politics is a mess all over the world. The main reason is neoliberal economics that takes from the poor and give to the rich. Until that stops the world will be in turmoil and dictatorships will spread.

  2. Such a timely post, Catarina, as the lack of democracy in some countries (such as Syria) is so startling as we watch the atrocities against humanity unfold. I thank god everyday that I was fortunate enough to be born in Canada, where all men and women are created equal.

  3. Democracy is a myth which is used to win people over. Businesses and governments must practice what they preach which rarely happens.

  4. One thing, when people discuss Democracy in any form, they fail to state that it is HARD WORK.
    A dictatorship is easy, one person tells everyone what to do. A democracy takes time, takes practice, and mostly takes tolerance of others.
    If you are, as in a business, going to allow other voices in the decision making, then you must accept those voice, and accept the fact they might not agree with you.
    People like to say they love democracy, but they hate to work to get it.

    1. As you know, we all agree about democracy being hard work. In Sweden decades ago they tried to have ALL employees have a say before decisions were made. Needless to say it didn't work mainly because in those days the majority of Swedish companies were manufacturing industries.

  5. I would say it's possible if the right leadership were in place. That may seem simple, but it isn't, especially in today's world. As it exists today, I am seriously worried for us all.

  6. I don't think there will ever be a way to make everyone happy. Living in the US during this turbulent times has made me even more aware of how different our wants and desires can be from that of our neighbors. But I do think that companies can decide whether or not to try and listen to their employees. The more companies factor in feedback from the employees, the more likely they are to have a majority of happy employees. But you will never have 100% agreement, And I think achieving a true democratic vision in a company where employees have a say in electing leaders and shaping the future of the company would be difficult in most situations.

  7. You cannot make everyone happy all of the time. Is the role of leader to make everyone happy or to do what is right? Whatever decisions leaders make, they must be willing to stand by them and support employees through the changes in the best way possible.

  8. You can't have a true democracy in a company. You can try to achieve consensus but the final decision always rests with the leadership, otherwise you will have chaos. What concerns me is that the leadership is not always looking out for the best interests of the organization. They enter into illegal practices. Citicorp, JPMorgan Chase & Co., Barclays PLC, The Royal Bank of Scotland plc and UBS AG have agreed to plead guilty to felony charges brought by the U.S.Department of Justice for conspiring to manipulate the price of U.S. dollars and euro. What does that say about our leadership in business — and government where scandals are reported every day.

  9. An interesting discussion. Democracy at the corporate level has no chance of succeeding without an engaged employee base that feels invested in the company that they work for. I think it has become less common for employees to think in terms of growing with their employer. Instead they often are looking to use their position as a stepping stone to move on to something else. I don't know that you can come up with a perfect democracy in a corporate environment but you can make meaningful moves in that direction which may pay off in terms of the commitment of the staff.

    1. Thank you. Glad you agree with me. Democracy is far as politics is concerned is so far the most palatable option when it comes to governing a state. Pity it's far from perfect.

  10. Hello Catarina

    I think this post truly speaks for situation of Pakistan.
    You are saying about the worth of one vote, but what can be situation, when a single person is stamping 1000 of votes for one person. Rigged elections can bring what type of results and I really like, when you said,”However, once in power they frequently proceed with doing something else”. The reasons are right, it can be when there are financial constraints etc. But I am wondering when in a poor country like Pakistan few families rule the country and come to stage turn by turn, promise people to bring back the looted money and then after establishing govt. what constraints are there, that stop them to do what they say in their campaign. Secondly, why we Pakistanis are so stupid that every time believe same person. What do you believe that democracy is solution for country like Pakistan?
    I am sorry, may be I am bit off the post, but as you have vast experience with international politics, may be you can shed some light on these questions. I hope I make sense as well.

    1. Pakistan is a perfect example of how democracy should NOT work. But unfortunately it's far from the only country. Not even in the West is democracy perfect. By the way, democracy is not perfect but, so far, it's the most palatable system of running a country we have invented. Pakistan has also had military dictators. Was that better for Pakistan?

  11. A true democracy is rare and idealist. Even here in the United States we don’t have a true democracy. Can you imagine how quickly business would come grinding to a halt if it had to take into consideration the thoughts, wishes and opinions of every employee? It’s just not feasible and most people realize and accept that.

    1. Absolutely it's impossible in businesses, apart from small jointly owned companies, Susan. Democracy doesn't work well when it comes to politics either. But the United States is increasingly becoming a travesty of democracy. Switzerland probably has the best form of democracy with their constant referendums.

  12. Catarina, I don’t believe it’s possible for democracy to exist in corporations, although I do believe that upper level management would benefit greatly from listening to their staff and getting their input. All you have to do is think of committees – they can meet for a year to discuss one issue and rarely come to a unanimous agreement.
    The same with government. They worry about support, power, getting re-elected. Those are their priorities.

  13. The concept of democracy in business is a great one. In reality though, I’m not sure how plausible it would be. Especially once you bring things like shareholders into the mix with a big company, you have too many people with varying needs and agendas.

    The best employers realize that it is important to keep both the employees, the board, and shareholders happy and find some middle ground. Some people by personality do a better job at rallying people together and finding a compromise. However, it is impossible to meet everyone’s needs and there will always be upset on some level. And it is certainly not always the majority that wins.

  14. Great questions! It is definitely easier to make decisions with a small one person business. But, you don’t necessarily have feedback that would come with having a company with more people to help you get to that decision. The leader takes on the responsibility of making decisions but it is important that they take others viewpoint into consideration. A leader needs to lead and if workers don’t feel appreciated, then they won’t follow.

    1. Thank you. To let workers feel appreciated is another aspect of leadership, Sabrina. To implement democratic decisions in a business is different. Imagine if workers, who are frequently in majority decided how to run a company would lead to bancrupcy. Just a question of how long it would take.

  15. I don’t think a true democracy can work in most business. Maybe a small business. For instance, the few companies that are actually owned by the employees. I found a list of the largest employee-owned companies in the US. If it hadn’t been for your post I would have never looked.

    Number one is Publix Super Markets with 160,000 employees. The rest are much smaller. In fact, most have less than 10,000 employees.

    I think democracy works best when kept small. Big becomes messy. I just checked and found this site that says there are three basic types of Democracy:

    1. Direct Democracy (Switzerland)
    2. Preisdential Democracy (USA and France)
    3. Parliamentary Democracy (UK, Germany, Spain, Italy)

    Except the definition for Presidential Democracy says the President is elected by the people and the people do not elect the U.S. President. The Electoral College with about 500 people does that. What does that say about the U.S.?

    Is the U.S. really a democracy after the Supreme Court ruled in Citizen’s United that corporations are equal to individual voters, and what about a democracy with a crony capitalist economic system that allows corporations and/or billionaires the ability to actually buy and control elected state and federal representatives all the way to the White House?

    1. Glad you agree with me, Lloyd. Only small jointly owned companies can have democratic decision making. Have worked with governments most of my life and where in the world do we have true democracy?

      1. We don’t even have a true democracy in most public schools and they have democratically elected school boards, but teachers seldom if ever have a voice in major decisions that impacts the children we teach.

  16. I don’t think true democracy can work in a large business. First, the logistics would be so difficult decisions would never get made. Second, each employee has his or her area of expertise, but often doesn’t know enough about all aspects of the business to make the best choices. However, I also think leadership that doesn’t value its employees and their knowledge, allow them some autonomy within their spheres and accept their input is doomed to fail.

  17. I do not believe democracy is a sensible process for any businesses. If it is, it is wise for a very small number. Now pushing decision making down to those doing the work as much as possible makes a great deal of sense to me, but not democracy.

    For government I think real democracy makes more sense. And the internet makes it more practical. But still it is not practical. The representative governments – like the USA – is the best model. People elect others to craft laws, oversee the executive branch and vote on laws.

    The current result of the USA representative form of government is pitiful in my opinion. We chose to elect people primarily that raise the most money. They do this by serving those that give them cash (so they get the most money). Obviously if they are serving those that give them the most cash they are not serving the interests of the country.

    The fault lies with the voters choosing to elect and re-elect extremely corrupt politicians (and their political parties). Until we stop doing that we will get the same results the current political parties have been providing for decades. It is very unlikely they will spontaneously start putting the interest of the country above the interest of those giving them cash. We have to replace them with people that put the country fist. Until that is done, we can expect a continuation of what we have been getting.

  18. Catarina in the USA we are so far away from being a democracy, there's not enough time or space for me to rant. We have a despicable group of gangster politicians who have: 1) voted themselves exempt from taxes which the rest of us by law, have to pay, 2) voted themselves retirement with all benefits for life, even if they serve just 2 years, find me work like that in the REAL world, 3) do NOT vote for what a majority of people say they want but instead vote the majority of their votes based on lobbyists and the most corrupt corporations are willing to pay them.

    Democracy around the world? I don't see it. Where is it Catarina?
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    1. Yep. your country is a sorry example of how democracy should not work, Patricia. And on top of it your politicians have for quite some time been keen on exporting American democracy. With horrendous results I should add.

  19. Leadership and democracy are compatible provided the culture of the nation, company, institution or organization is democratic. For the most part, people in democratic societies expect leadership within the bounds and constraints of their democratic institutions. Great leaders understand and work within those constraints by exercising influence, rather than outright control. By contrast, when we move to an autocratic society people expect a strong leader who is willing to act outside of democratic and other social constraints. Results are what matter with the latter. In other words, the culture of power and the power of culture go a long way to set the expectations on what leadership looks like. Like most things involving people, context matters.

    1. How do you run a multinational company with say, 250 000 employees if all members of staff should have a say before a decision is taken? The majority of employees are frequently low skilled and don't know how to run a company. They would be in majority and hence decide how the company is run. The way "democratic" countries and companies are run is only semi democratic which is what you write about in your comment. The country where voters have most say is Switzerland that frequently hold referendums. Democracy is not perfect but, so far, it's the most palatable option of running a state.

      1. Ultimately it comes down to the scope and authority granted across an organization. One philosophy holds that one is better off allowing, encouraging, developing and supporting decision making as close to the problems and opportunities as possible. That entails risks, of course, but there are always risks. Much of the time even experts describe problems and then claim that they would not have occurred if something else had been done, which is a claim that can't be proved or disproved. Even if that problem had not occurred, a different arrangement would likely have created other problems.

        A key difference between centralized and decentralized authority and decision-making is that the latter is better at responding to operational level issues and using highly relevant, more focused information. The alternative one can work, but is generally subject to lack of awareness down to the operational level. And the more widespread the company, the more likely it is to be so. There is nothing easy about running such widespread operations, which may explain why most companies hit boundary limits long before they spread across the globe. I recently posted a piece called The Man Who Saved Your Life that illustrates the value and risks associated with making decisions operationally that have global implications. Something to think about!

        1. We are merely discussing democratic leadership in this article. Leadership is a huge subject that can not be covered in one article. As you know I have written numerous articles about different aspects of leadership. But here we only focus on if leadership in a huge organisation can be truly democratic i.e. one employee one vote. Nothing more. Leadership can work anyway, but it's not truly democratic and a different issue. A small jointly owned company can be truly democratic. But a huge one, no.

  20. Right now you can see in the USA that leadership and democracy don't necessarily go together. Our politicians, right on up to the top, are doing what THEY want. Not necessarily what the public outcry calls. It's about winning the next election, to stay in office, to retain power, to whiddle away a little more at – democracy.

    As always, an thought provoking post.
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  21. I think that people want to believe that a true democracy can be put into place and work, but I don't see that happening in a government or in a business. There needs to be voices heard, but ultimately not everyone can have a say in decisions because everyone will not come to the same conclusions. Interesting idea though!
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  22. You pose a good question. I have never believed (since I was old enough to understand the government and form my own opinion) that we were purely democratic. Sure, we have the right to vote. But how many elections would have been different if it was based on amount of votes alone? It is reasons like that that politics become difficult to understand.
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    1. That's a problem with the American system. In Europe we don't have the electoral system. Your founding fathers had to add the electoral system to please representatives of small states. Agree with you completely that the amount of votes should determine who will govern.

  23. I think there is value in getting input, but someone needs to take the responsibility for the final decisions.
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  24. Businesses do not exist to promote equality . . . even non-profits are very competitive. It's not just a matter of some sort of "harmony" within an organization, but also between them – if there is disharmony between, then eventually there will be within an organization.

  25. A corporation is a kind of repressive socialist state where every worker is equal but each must respond precisely to collective authority. The corporate genome – the sequenced and mapped skills of work and workers — is leadership's archive, containing the plans for each type of worker, the master program for generating a 10-thousand-worker company from a single thought, and the life cycle instructions that guide it from birth to adolescence and maturity.

  26. It's an interesting question. There are certainly times when it feels like the drive to engage employees is leading management down this path, but just as governments can't be run like businesses, business can't be run like government. The objective of a business is not to serve the majority of employees. Their input is valuable and can bring terrific insight, but insight isn't vision. The more employees, the broader the spectrum of priorities and then a process that forces agreement based on general knowledge not expertise. No business runs effectively without a vision, a concise list of priorities, a focus on the customer and clearly defined strategic goals.
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  27. Good post as always Catarina. Leadership is essential for any democracy to survive, and within the confines of a business even a coop needs to have a board of governors. Not everyone knows , or wants to know the big picture, nor are they qualified to make a decision because of that. In theory electing leaders to represent the people's interest is a good system, but as we all know politics often comes down to money like everything else in this world.
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  28. Having run a small business, I don't think a true democracy would work although I think businesses run best if the employees feel that their work and opinions are valued. Further, although employers don't necessarily legally owe employees an explanation for their actions, my experience is that this goes a long way towards getting people on board.

    In a true democracy, there is a tyranny of the majority. This is why our Founders (here in the US) set up a government with checks and balances. The Supreme Court is the least democratic of our institutions, but is often the body that looks out for the rights of minorities in our society.
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    1. Thank you for conveying your thoughts Suzanne. Perfect democracy is impossible. In a small business what you suggest is applicable.

      When it comes to politics, democracy is better than the alternatives. But it's still a flawed concept.

  29. As you said, Catarina, another fad. If anything, I've been inveighing against the fads and fashions of organisational analysis, group dynamics, consensus building, and every other idea to come down the pike as a sorry substitution for management.

    This idea seems like another of the many inflicted on business for half a century.


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  30. Democracy is a system to choose leaders who are accountable. They are accountable to the ones who chose them as leaders. What they do once chosen as a leader is often not what they thought they would do nor what they said they would do. However, in a democracy, they are still accountable for their decisions and actions. Even company directors are accountable to the shareholders. They must be re-elected on a regular basis. Democracy is not about voting on every decision. It is about choosing leaders and then holding them accountable for their decisions and actions.

  31. I dont believe pure democracy is possible either. I can only imagine that it would bring things to a grinding halt. It is a nice ideal but not really practical.

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    1. True, above all, when it comes to businesses Rebecca. However, Switzerland has a better form of democracy with constant referendums on issues of importance. That enables the voters to have their say instead of politicians deciding.

      1. Governments can definitely be, and should be, more democratic, Jeri. The best country at the moment is Switzerland that hold a lot of referendums on important issues. When it comes to busiesses it's a great idea in theory but how can it be done and still make a profit. Unless of course it's a small jointly owned company. They almost always have a democratic decision process.

  32. A true democracy is rare. Even the US isn't a true democracy. It is as you said, an ideal. When you're a business and have to get things done, to take all thoughts, opinions and considerations into a decision it would stop the process of doing business, not a good thing. It really is a balance between being thoughtful and honest in what your intentions are. Many will accept that not all opinions are worthy or can be heard. They need just want to know what is and isn't part of the process.
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  33. Hi Catarina,
    This is an interesting question. Here in the U.S., there is some research suggesting subcontracting and outsourcing are increasing in frequency which will likely lead to a decrease in full time employment. Also, social media sites like Facebook operate largely on the content creation of millions of individual businesses and individuals. Arguably, these users are a hybrid. They certainly are customers, but in a way, some also take on the role of quasi-employees. They create content which social networks use as both the service and product of their operations and receive compensation in the form of traffic and community. But both contractors and users are more autonomous than employees. Is this democracy? It's certainly an evolution in work.
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    1. That's a way of looking at the issue in a wider aspect, Heather. You are right about such developments taking place, not only in the US but all over the world. It's an improvment but doesn't, in my opinion, make leadership and democracy truly compatible. Do you believe leadership and democracy are truly compatible?

  34. Catarina — Unfortunately, most politicians will make any promise to get elected without the commitment to following through once they're in office. As you know, there is a battle raging in the U.S. about gun control laws. The National Rifle Association has such a huge influence on lawmakers that almost no meaningful legislation has been passed to limit the use of hand guns and semi-automatic rifles here. However, after the massacre of 20 children in Newton, CT, families of shooting victims from around the country have descended on Washington to make their voices heard. It's hard to ignore a mother whose 6-year-old child was murdered. So ordinary citizens, when speaking in one voice, can have a powerful impact and it looks like we will have gun control legislation passed at last. Democracy is very sloppy. In a dictatorship, one tyrant rules. In a democracy individuals can have a voice but they need to come together around an issue if they want to have a real impact.
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    1. Glad you agree with me Jeannette. Got the video of parents of the White House sent to me by The White House. You can sign up if you are pro gun control. The power of the NRA is scary, and people die as a result. Even children.

  35. You raise important points, as do your commentators. Democracy sounds like a great idea, but you can't run a business if every vote is counted alike. It's hard enough to do so in a government (and those with money always seem to have a bit more influence in any case).

    Ideally, an employer should at least make employees feel that they have a voice.
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  36. I found this to the case with a company I worked for a long time ago. They changed the management structure and wanted me to get approval from a committee of individuals who didn't want that responsibility and all had different opinions. It was a nightmare and eventually that all fell apart.

    I can definitely tell that you have plenty of people voicing their opinions on this topic. As they should because there is so much wrong with our government today. But what's the answer? Darn good question. Will it ever be fixed? Probably not! There are too many very opinionated people in those positions with a lot of money and frankly, that seems to be all that matters to them. To heck with the rest of us.

    Thanks Catarina.. I do enjoy hearing other people's opinions on this topic and you definitely have received a lot of comments. Keep up the great work.

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  37. I think you’ve failed to make a critically important distinction: In a true democracy, the citizenry collectively make its own decisions, and every citizen has an equal say. With the possible exception of Switzerland, I don’t think any government on Earth is a truly direct democracy. Certainly, the USA isn’t–it’s a republic, not a democracy. In a republic, although citizens theoretically retain control of their government, they elect representatives to run it for them.

    The American founding fathers were very suspicious of democracy, and intentionally designed a republican system of government so that the “mob” could not take over the new nation. In a democracy, a majority of citizens can vote to abolish individual rights, but in a republican system, citizens have unalienable rights that cannot be voted away by the tyranny of the majority.

    Any corporation in which a board of directors is elected by, and responsible to, the corporation’s shareholders is displaying a republican system of self-governance—not a democracy.

    Direct democracies do not need leaders, since decisions are made through the collective will of the citizens. But even in representative democracies, the people retain ultimate control of their government: All they have to do is vote to get rid of any government, or government official, they don’t like.

    The fact that the majority of eligible U.S. voters–to take one example–rarely vote does not mean that the electorate has little, or no, control over its government. It simply means that most of the electorate has chosen not to exercise that control. The electorate has not relinquished its authority, because voters can sweep a government or an individual out of office at any time.

    And, of course, many U.S. states have constitutions enshrining the right of citizens to overturn legislation through the referendum, to propose legislation through initiatives, and to shorten an official’ s term with a recall election.

    The problem you seem to be ascribing to “democracy” has much more to do with voter apathy than with the inherent flaws of any representative system of government.

    1. Steven, thank you for your comment.

      You actually have voter apathy all over the West because politicians promise one thing and then once elected forget about their promises and do the opposite. In other words democracy is a more of a concept than reality.

      Glad we agree that it's difficult for a corporation to be a democracy. Unless of course it's a small jointly owned company.

    1. Reminds me of when I lived and worked in Saudi Arabia. One colleague wanted to have quotes from the Koran on the web site I was creating.

      The sheikh who owned the conglomerate then said "Let's not bring religion into this". I second his opinion when it comes to this discussion. My blog is read in 89 countries by people of different faith.

  38. Seems you agree with me Keyuri. Trouble is when we vote for a politician he/she then proceeds to do the opposite of what was promised when elected:-) Catch 22, isn't it?

    1. Yes Catherine, it's a difficult balance in a company isn't it? But as far as politicians are concerned their main priority unfortunately is, has always been and presumably always will be, to get re-elected. How can the voters win?

  39. Certainly, on a larger scale (as in the case of countries and multinationals) true democracy isn't possible. The number of opinions and options being offered in any decision making process would prevent business from moving forward, and I think you're right that most people would look out for their own best interests.

    Although, even in smaller companies or organizations, I think you'll still run into similar problems. Not everyone is born to be a leader, so it makes sense to allocate power to those who show a predilection towards it (or, at the very least, invite it upon themselves). Obviously, there are going to be issues with this type of system (especially when you add complicating factors like profit margins, lobbyists and leaders who promise X and do Y), but I think overall, an organization will grow faster when power is centralized than in a true democracy.
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  40. The fact that the majority decides doesn't matter when it comes to huge multinationals with an abundance of low skilled labourers Oliver. When they are in majority their choice would determine the future of the company. How many of them would understand big and complicated issues and hence be able to vote on them?

  41. If democracy truly exists, let all the voices be heard even the lowest rank position. They do conduct General Assembly, but tell I tell you, still their ideas are used and applied. I think democracy in corporate is impossible to achieve.
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  42. Democracy in business.

    As Yogi Berra said, "In theory there is not difference between theory and practice. In practice there is."

    In business, democracy is fine. But the marketplace will be the determining factor.

    Democracy demands that everyone participate in the process. Thus, we shall look at some of the participants of days gone by.

    If you sail that way, you'll fall off the edge.
    That'll never get off the ground. If God wanted me to fly, he'd have given me wings.
    The motor car? Noisy, smelly toy for the rich. It will never replace the horse.
    Talkin' pictures? Folks don't want to listen to all that chatter. They want to see real acting.

    Democracy in business?

    No motor car.
    No Aeroplanes.
    Silent Films
    No Television

    It takes ten people to say yes but only one person to say no.

    Laws are not made for the law-abiding.

    Congress made the President commander in chief of the military, not chairman of the committee in chief of the military.

    Statues are erected to leaders, not committees.

    Or, as Teddy Roosevelt said: Put the best person you can find in charge and get out of his way.


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  43. Pure democracy works well in small groups but there are definately "economies of scale" when it comes to larger ones. This is the primary reason why most western democracies like the US end up with a "representational" democracy, which does not serve the individual as well, and places too much power in the hands of the politician who ostensibly "serves" their constituency. In business organizations we can see a similar model where functional departments and divisions have managers that "represent" their operating areas and speak for them as necessary. How much democracy leadership and management chooses to derive from this input varies widely. From my own observations, I think business has more opportunity to leverage the principles of democracy than government does – but in the end – I think the results are pretty much the same. Politics most often wins out over the will of the constituents. While I don't see an inherent incompatibility between leadership and pure democracy, I just think it becomes too hard to integrate the two in large organizations.

    1. In other words Chris, you agree with me. By the way, I would be interested in knowing if you really believe democracy as a concept is perfect? If so, where have you found it?

      Since you believe business has more opportunity to leverage the principles of democracy, I would sincerely be interested in hearing about a large company that you know have succeeded in doing so.

      1. Hi Catarina, Hi Chris,
        the larger or more global the organization the more difficult to drive businesses upon the base of "democracy". I.e. all decisions made in headquater also affect people outside of the constituency, who do not have the possibility to vote. There is also another aspect we have to take into consideration: with regard to the same organization there are diffrent priority objectives depending on the party. The workers have focus more on the work conditions and wages while the shareholders or owners on turnover and profit. Hence it is important to have a leader who als generalist and global thinker would be able to find the optimat intersection and to balance the particular interests. I believe we still should have aspiration to deal on the base of democratic premises even if we would never be in position to reach that ideal.
        Best regards

        1. Good comment Mariola. Seems we agree about the difficulties with implementing true democracy in a multinational global corporation. We also have to remember that Workers are not always able to understand big issues such as IPO:s, mergers and re-financing and hence not capable of voting on them.

  44. In my previous company, workers could not really influence the decision of the managers. We can give suggestions but still, they will rather choose their own disposition because they believe that is right and that's good for the company. It's the reality.

  45. Hi Alexa

    Hi Alexa

    This is an interesting question…. with challenging remarks but I wanted to add my five cents:

    You ask: "Can true democracy really be practiced in a business?":

    Businesses do not necessarily have leaders but managers instead (hired guns) Second, business is not democratic because those that provide the capital needed decide while others such as workers can influence the process only.

    Even in a cooperative you do not have a true democracy since the members would on general things during the annual meeting while those chosen to manage make the operative decisions.

    Thanks so much for sharing. Urs

  46. Hi Catarina,

    Another great thought provoking post. Reading it made me think back to a story of a company where the employees were shareholders and became involved in all decisions. There was a book written about it, although I can't remember the name. Apparently the company became very successful.

    In most multinational companies it just wouldn't work as far as I can see because to make the big decisions you have to have all the information as well as the skills and experience to make the decisions.
    My recent post 3 Marketing Lessons From Soap Operas

    1. Thank you Susan. Good point that in a multinational it's simply impossible because in order to make the big decisions you have to have all the information as well as the skills and experience to make the decisions.

      1. Catarina,
        I'm in agreement with Susan. Empowering employees to contribute in decision making process is important to the well-being of the organization It's foolish to ignore what the employees in the "ranks" have to contribute. However, bottom-line, (as Susan points out"), the big decisions need to be made by those individuals who have the skills and experience.
        My recent post Low Cost Resources Small Business Owners and Entrepreneurs Can Access

        1. Glad we all agree Sherryl. Examples of companies where they have succeeded are small and usually owned by the employees. Then it works. Would really love to know how it can be done in a huge multinational. We all agree it benefits a company but the drawbacks can be severe when 250,000 people look after number one, unfortunately.

  47. Hi Catarina, I agree with you that true democracy in business or politics is more of an ideal that can't truly be carried out with positive results in either situation. Think about how hard it is to get three people to agree on one thing. Can you imagine trying to get an entire company to all agree on the same thing? No decisions would ever get made and nothing would get done. A leader should care about what the people think, try to do what is in the best interest of all and listen to what others say, but in the end, the decision making power needs to remain in the hands of a select few.
    My recent post “Work” Combined with Passion is not “Work”

  48. For sure NO on a startup or a turn around, on an institutionalized and established company you can have some democratic decision making committees but the Board and the shareholders assembly has to be controlled by someone or a Group, that when needed makes things happen when the collective wisdom is wrong.

  49. Everything, when taken to a extreme is not good. When a leader does only what he thinks is right, without taking into account what his followers think, becomes a tyrant and when he only does what the majority says he may lose some good opportunities. I don't think a business could be run as a true democracy because the leader in a company is the leader not only becasuse he can integrate other's ideas into his decisions but because he knows enough of the business to make decisions on his own

  50. As you say, Catarina – democracies don't really exist anywhere as politicians invariably fail to meet election promises. Switzerland may well be the country with the greatest degree of participation by its citizens in the "business" of running the country due to its frequent referendums.

    In a company, the concept of having everybody with an equal say in all matters would result in chaos, and would so be unworkable.

    Perhaps countries should be run more along company lines with the shareholders(taxpayers) having a say proportionate to the shares they own (tax they pay)… Contentious, I know, but it would mean that those who avoid tax would have no real say.

    1. Great comment Guy.

      You may very well be right about Switzerland.

      Interesting idea of taxpayers/shareholders having a say in proportion to their shares. Could make people more motivated to pay tax?

    2. Yes indeed, Swıtzerland's direct democracy should have been mentioned together wıth its rather uique government that is a coalition of all partıes and that makes decision making a very complex and slow process

      1. MIchael, Guy who commented earlier today did mention Switzerland. Do you consider the Swiss system to be truly democratic. Not just the best in the world at the moment?

        To quote you it "makes decision making a very complex and slow process". So, do you believe the Swiss system can be applied to a multinational company? It would obviously make the corporation more democratic. But would it become un-governable and lose money by doing so? How would it impact leadership of the company?

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