What business case would you not likely make to Costco to decentralize its organizational structure and empower its employees?

journal article

The Limits of Organizational Democracy [and Executive Commentary]

The Academy of Management Executive (1993-2005)

Vol. 18, No. 3 (Aug., 2004)

, pp. 81-97 (17 pages)

Published By: Academy of Management

https://www.jstor.org/stable/4166094

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Abstract

Despite decades of encouragement from theorists and consultants, managers have generally not embraced democratic process as a system of management and decision-making in organizations. While it is tempting to explain this state of affairs in terms of managers' reluctance to share power, this article considers the possibility that democracy's limited success is due to its own limitations as a system of organizational governance. The article questions two common assumptions: (a) that political democracy provides a useful model for organizational democracy, and (b) that democratic process is applicable in all organizations. Close analysis suggests that political democracy provides little guidance for organizational democracy because its essential characteristics--accountability to the governed, right of participation, free exchange of information, and right of representation--are rarely, if ever, supported in organizations. Furthermore, the basic function of political democracy--legitimization of authority--has no counterpart in organizations. As for applicability, the article argues that democratic process can only be successfully implemented where it contributes significantly to competitive advantage and organizational performance. This depends on several contingency variables, including the nature of the organization's products and services, the characteristics of its workforce, and the degree of hierarchical resistance to redistribution of power and control.

Journal Information

Effective with the February, 2006 issue the Academy of Management Executive has changed its name to the Academy of Management Perspectives. The overall goal of the Academy of Management journals is to serve the interests of the Academy's members, and the specific goal of the new Academy of Management Perspectives (AMP) is to publish accessible articles about important issues concerning management and business. AMP articles are aimed at the non-specialist academic reader, and should also be useful for teaching. Serving both these goals more effectively requires a change in strategy and direction for the journal. Going forward, Perspectives will concentrate on two types of articles aimed at this thought leader audience. The first are accessible surveys and reviews of contemporary knowledge about management and business issues. The goal would be to make information about empirical research in management accessible to the non-expert, including students, and the focus of the reviews would have to be on the phenomena of business and management, not the development of the academic literature.

Publisher Information

The Academy of Management (the Academy; AOM) is a leading professional association for scholars dedicated to creating and disseminating knowledge about management and organizations. The Academy's central mission is to enhance the profession of management by advancing the scholarship of management and enriching the professional development of its members. The Academy is also committed to shaping the future of management research and education. Founded in 1936, the Academy of Management is the oldest and largest scholarly management association in the world. Today, the Academy is the professional home for more than 18290 members from 103 nations. Membership in the Academy is open to all individuals who find value in belonging.

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