Companies that have adopted participative management practices typically have more highly engaged employees who are more hardworking, creative, and feel greater loyalty towards their employer.
The South Mountain Company of Martha’s Vineyard, is a design and construction company with annual revenues of $9 million that provides integrated development, architecture, building, and energy services. South Mountain has been practicing workplace democracy for over 20 years.
Currently 17 of its 33 employees are owners, and the rest are on the five-year process to become ’employee owners.’ Employee ownership has played a big part in helping South Mountain retain its workers, who have been with the company for an average of 12 years.
Each employee owner has an equal vote in major strategic decisions, one of which authorized a profit sharing program which distributes 33% of South Mountain’s profits amongst all employees.
Similarly, the New Belgium Brewing Company credits workplace democracy with helping them become the third largest craft brewery in the US, with $93 million in revenues. All of New Belgium’s 320 employees become owners after their first year of employment, and the company’s open-book management policy ensures that all workers know where the company is going and how it’s progressing.
Another democratic company that shares financial data and strategic information with its employees is Badger Mining Corporation, which is the fifth largest manufacturer of industrial silica sand, limestone and other aggregates.
The company has been operating under a flat organizational structure for close to 25 years. Bosses are called coaches, employees are referred to as associates, and the executive management is called the advisory team. All 170 employees share 20% of the company’s profits.
Treating its workers like responsible adults and sharing information, decision-making abilities, and profits among all team members has helped Badger minimize employee turnover, which is very expensive and disruptive to a company’s operations.